AGENDA MARCH 9, 2011 5:00 PM 1. Meeting called to order 2. A ...

951Martin Luther King Boulevard. Kissimmee, FL 34741 407-944-5000 www.tohowater.comBruce R. Van Meter, Chairman Brian L. Wheeler, Executive Director Mike Davis, General CounselJohn E. Moody, Vice Chairman Nilsa C. Diaz, Executive Assistant Mark Lawson, General CounselRichard L. Hord, Supervisor 2Raul S. Banasco, SecretaryRobert J. Bornstein, Vice Chairman Pro TemThomas White, Supervisor 31. Meeting called to orderAGENDAMARCH 9, 20115:00 PM2. A. Moment of Silent ReflectionB. Pledge of Allegiance3. Approval of the Agenda4. Awards and Presentations:PROCLAMATION TO DECLARE MARCH 14 th -20 th , 2011 AS FIX A LEAK WEEKIN OSCEOLA COUNTY5. Public Hearing6. Hear the Audience7. Consent AgendaThe Consent Agenda is a technique designed to expedite handling of routine and miscellaneous business ofthe Board of Supervisors. The Board of Supervisors in one motion may adopt the entire Agenda. Themotion for adoption is non-debatable and must receive unanimous approval. By request of any individualmember, any item may be removed from the Consent Agenda and placed upon the Regular Agenda fordebate.A. APPROVAL OF BOARD MEETING MINUTES FROMFEBRUARY 23, 2011B. APPROVAL FOR EMERGENCY MANHOLE REPLACEMENT ONOAKWOOD BLVD. IN BVLC. APPROVAL OF THE UPDATES TO THE PURCHASING MANUAL

D. APPROVAL OF DEVELOPER SERVICE AGREEMENT AMENDMENTFOR PARADISE COVE PHASE 2E. APPROVAL OF BID FOR UTILITY IMPROVEMENTS OF HOAGLANDBOULEVARD WIDENING PROJECT PHASE IF. APPROVAL OF SPONSORSHIP FOR DARK SKY FESTIVAL @HARMONY8. Informational presentations (Require no action) QUARTERLY INVESTMENTREPORT BY PFM GROUP - QUARTER ENDING DEECMBER31, 20109. Unfinished Business10. New BusinessA. APPROVAL OF THE DONATION OF ONE OF THE OLD 5000 GALLONHYDROPNEUMATIC WATER TANKS TO YOUTH WITH A MISSION(YWAM)11. Staff Reports:REPORT ON REFINANCING OF THE SERIES 2007 BONDS THROUGH THESALE OF THE SERIES2011A BONDS12. TWA Board Officials13. Adjournment

CATEGORY: PresentationPROCLAMATION TO DECLARE MARCH 14-20, 2011 AS FIX A LEAK WEEK IN OSCEOLACOUNTYExplanation: Fix a Leak Week, a national awareness campaign from the EPA’s Water SenseProgram, helps focus attention to the fact that every year more than 1 trillion gallons of waterleaks from homes across America.Fix a Leak Week shows how you can save water and money by checking household fixturesand irrigation systems and fixing every leak, no matter how small it seems to be.The purpose of commemorating Fix a Leak Week is to bring awareness and help residentsaddress water waste in the home. To commemorate Fix a Leak Week dye test tablets andtoilet flappers will be distributed to customers during the week of March 14 -20, 2011 at theAdministrative Office located at 951 MLK Boulevard and our Customer Service Center locatedat 601 Country Club Lane. This event will focus on bringing awareness to customers on theneed to conserve our most precious resource.Recommendation: Staff recommends the Board of Supervisors proclaim March 14 -20,2011as Fix a Leak Week for Osceola County residents.FixaLeakWeekProclamation03.09.11.mg4

Description Regular meeting of the Tohopekaliga Water Authority. Present at the meetingwere Supervisor Bob Bornstein, Supervisor Raul Banasco, Supervisor JohnMoody, Supervisor Dick Hord, Supervisor Tom White, Attorney Mike Davis,Executive Director Brian Wheeler, Executive Assistant Nilsa C. Diaz, ChairmanBruce Van Meter, Commissioner Jerry Gemskie and Mike Harford.Date 2/23/2011Time Item Minutes5:04:30 PM MEETINGCALLED TOORDER5:04:37 PM MOMENT OFSILENTREFLECTIONAND PLEDGE OFALLEGIANCE5:05:26 PM5:05:59 PMAPPROVAL OFTHE AGENDAAWARDS ANDPRESENTATIONS5:10:57 PM PUBLICHEARING5:11:11 PM HEAR THEAUDIENCE5:11:17 PMCONSENTAGENDALocation TWA BoardroomMeeting called to order by Chairman Bruce Van Meter at5:04PM.After a Moment of Silent Reflection, Supervisor White ledthe audience in the Pledge of Allegiance.An item was added under New Business 10C. APPROVALOF DEVELOPER SERVICE AGREEMENT FOR QUALITYHOMES US CONDOMINIUMS, LLC.; Supervisor Moodymoved for approval of the Agenda with the addition of Item10C and Supervisor Banasco seconded the motion. Motionapproved 6 to 0.Ritchie Coronel was recognized as Employee of theQuarter. Steve Santiago and Richard Castro were presentto be recognized as part of the Team of the Quarter whichalso included. Dr. Margie Cintron, from Horizon CounselingCenter, presented the Board with a plaque as gratitude forsome surplus property (computers) which Toho donated tothe counseling center. Brian Wheeler recognized IranMendez and James Lontz (in absentia) for receiving theAward of Distinction from the City of Kissimmee for going tothe rescue of a local resident who was being attacked by adog.Non-scheduled.Mary Jane Arrington thanked the Board for their support ofthe Aquatic Program at the YMCA.Supervisor Bornstein requested that items 7B, 7C, 7D, and7F be removed from the Consent Agenda for discussion.Supervisor Moody moved for approval of the ConsentAgenda including Items 7A, 7E, 7G, 7H, 7K, 7L, 7M, 7N andSupervisor White seconded the motion. Motion passed 6 to

0.7B. APPROVAL OF JANITORIAL SERVICES - SupervisorBornstein asked about the possibility of having the janitorialservices for the TWA facilities provided internally. ChairmanVan Meter disagreed with Supervisor Bornstein adding thatit would be more costly doing it internally because youwould have to add in costs for benefits. SupervisorBornstein moved for approval of USSI to provide janitorialservices to the Authority but would like for RodneyHenderson to provide pricing for internal services;Supervisor Hord seconded the motion. Motion passed 6 to0.7C. APPROVAL OF GENERATOR MAINTENANCE ANDREPAIR CONTRACT – Supervisor Bornstein asked if theamount ($48,807.00) was an annual or bi-annual price.Staff responded that some of the services provided underthe contract were annual and some were bi-annual.Supervisor Bornstein moved for approval of the generatormaintenance and repair contract with CJ’s Sale and ServiceContract. Supervisor Banasco seconded the motion.Motion passed 6 to 0.7D. APPROVAL OF PURCHASE OF RETURNACTIVATED SLUDGE (RAS) PUMPS – SupervisorBornstein asked what the cost would be for staff tophysically remove the rags that periodically clogged theRAS pumps as compared to the cost of replacing thepumps. Supervisor Hord asked the source of the rags.Supervisor Hord asked if it was possible to put some type ofgrid system which can be shut to clear the trash. Staffexplained that the RAS pumps had a submerged suctioninlet that made providing screening impractical. Staff alsoexplained that there was only one bidder who could meetthe specifications. Supervisor Bornstein moved for approvalof the purchase of the return activated sludge pumps andSupervisor Hord seconded the motion. Motion passed 6 to0.7F. APPROVAL OF ARCGIS DESKTOP AND ARCGISSERVER SOFTWARE LICENSES- Supervisor Bornsteinasked when Toho had been notified that they would nolonger be covered by the City’s Enterprise LicenseAgreement (ELA). Marie Rios, Toho’s IT Manager,responded that the City had notified Toho last year and that

5:26:46 PM INFORMATIONALPRESENTATIONS5:27:05 PMUNFINISHEDBUSINESSthe expenditure had been included in the 2011 IT OperatingBudget. Supervisor Bornstein moved for approval of theArcGis Desktop and ArcGis Server Software Licenses;Supervisor Moody seconded the motion. Motion passed 6to 0.QUARTERLY INVESTMENT REPORT BY PFM GROUP –QUARTER ENDING DECEMBER 31, 2010 – continued dueto presenter not being able to appear.9A. APPROVAL OF THE ANNUAL FINANCIAL REPORTFOR THE AUTHORITY FOR FISCAL YEAR 2010 – DanO’Keefe of Moore Stevens and Lovelace, auditors for theAuthority, provided a PowerPoint summary presentation ofthe high points of the audit for fiscal year 2010. SupervisorHord asked how the auditors monitored the Authority’sprogress in addressing their recommendations. At thepresent time, there is no monitoring until next audit. TheBoard was interested in having the auditors provide aninterim report on progress in addressing therecommendations within the report. Mr. O'Keefe said thathis firm would come back as part of the audit at no cost.The Board agreed that they would like to have the auditorsreturn in six months to report on the progress in addressingtheir recommendations. Mr. O’Keefe will be back for thefirst meeting in June with a report for the Board. SupervisorBornstein moved for approval of the Annual FinancialReport and Supervisor White seconded the motion. Motionpassed 6 to 0.9B. APPROVAL OF IMPACT FEE POLICY AMENDMENTTO PROVIDE FOR TIME PAYMENT OF FEES BYTENANTS OF COMMERCIAL DEVELOPMENTS –Executive Director explained to the Board that the policywhich was approved by the Board in December 2010 allowsfor new business property owners to pay water andwastewater impact fees on an installment basis but does notprovide for new business tenants to use the installmentpayment policy. To provide the ability for new businesstenants to pay impact fees on an installment basis, Staffproposes to amend the Impact Fee policy to include aprovision for new business tenants. The business tenantpayment plan would provide for impact fees to be paid as amonthly surcharge to monthly utility bill. If the monthly bill isnot paid, service can be terminated to the business tenant.The tenant can transfer the allocation and/or credit forpayment to another tenant upon approval of the Authority.

The Board asked how the delinquent payment would beenforced and was told that a delinquent payment would behandled as any other failure to pay the utility payment.Supervisor Banasco discussed the Melao Bakery on BoggyCreek Road; business tenant that was in operation for twoyears before discovering that impact fees were owed. Thissituation occurred because of some inadequatecommunication with Osceola County on Certificate ofOccupancy inspections. Mr. Wheeler said that the Countyhas a new computer program that should improvecommunication. After discussion about whether the owneror the tenant should pay the impact fees, Supervisor Hordmoved for approval of the Impact Fee Amendment andSupervisor Moody seconded the motion. Motion passed 6to 0.9C. APPROVAL OF SECOND SUPPLEMENTALRESOLUTION – Toby Wagner, Southeast InvestmentSecurities, financial advisor to the Authority, stated that atthe last meeting the Board discussed giving the ExecutiveDirector flexibility to use a portion of capital reservesbetween $1 to $3 million to contribute towards the Series2007 Bond refinancing to meet targets for going to market.As of last week, the refinancing could have beenaccomplished meeting all targets without having to use anyreserves. Mr. Wagner said that the resolution beingproposed for Board approval would give the ExecutiveDirector and Board Chairman the alternative to do a partialrefinancing to get into the market quickly should it benecessary. The resolution also provides for an alternative touse bank financing if that opportunity became available too.Supervisor White moved for approval of Resolution 2011-003 incorporating the changes to Sections 2.04 and 2.05which gave both the Chair and the Executive Directorauthority to give direction to the Financial Team to enter themarket. Supervisor Moody seconded the motion. Motionpassed 6 to 0.6:37:02 PM 10A. APPROVAL OF THE FIRST AMENDMENT TO THEBRONSON PROPERTIES TEST WELL AGREEMENT –Tetra-Tech, after conducting 12 month monitoring on theChapman and Bronson test wells, recommended anadditional 12 month monitoring on the aquifer levels of theBronson test well to supplement the data gathered from theChapman test well. Supervisor Hord moved for approval ofthe first amendment to the Bronson Properties test well

agreement. Supervisor Banasco seconded the motion.Motion passed 6 to 0.10B. APPROVAL OF INSTALLMENT PAYMENT OFWATER AND WASTEWATER SYSTEM DEVELOPMENTCHARGE (SDC) FOR MELAO BAKERY – When MelaoBakery located in a strip shopping center on Boggy CreekRoad decided to expand their business, Staff discoveredthat water and wastewater impact fees had not been paidwhen the business initially opened. The owners are nowconfronted with the requirement to not only pay impact feesfor the expansion but also to pay fees for when the originalbusiness opened in 2008. The Authority did not assess theimpact fees for the Melao Bakery in 2008 because staff wasnot aware of the business due to miscommunication withOsceola County. The impact fees for the two phases total$29,431.25. The owner does not have the financial capacityto pay the total amount in one payment and is asking theBoard for authorization to pay the System DevelopmentCharges on an installment payment basis. SupervisorBornstein moved for approval of installment payment ofSDCs for the Melao Bakery. Supervisor Moody secondedthe motion. Motion passed 6 to 0.10C. APPROVAL OF DEVELOPER SERVICEAGREEMENT AMENDMENT FOR QUALITY HOMES USACONDOMINIUMS – Quality Homes entered into aDeveloper’s Service Agreement (DSA) with Toho in 2008.Included within that DSA was an agreement by QualityHomes to construct a sewage lift station that would alsoserve an adjoining property upon which a Sikh Temple wasto be constructed. Because of the economic recession andthe collapse of the housing market, Quality Homes has notproceeded with its project including the sewage lift station.However, construction of the Sikh Temple is ready toproceed. To provide sewer service to the temple, QualityHomes has proposed to amend their DSA to provide for theconstruction of a temporary lift station. The Agreement callsfor the lift station to be built to Toho standards andmaintained by the Sikh Temple. When the Quality HomesCondominium project is built, the permanent lift station willbe constructed and the temporary lift station abandoned.The Board wanted to assure that the responsibilities werespelled out in the separate DSA with the Sikh Temple.Supervisor Bornstein moved for approval of the amendmentto the DSA with Quality Homes USA Condominiums.

7:03:01 PMSupervisor White seconded the motion. Motion passed 6 to0.Supervisor Banasco inquired about the status of theHarmony water quality situation. Mr. Wheeler advised theBoard that over the weekend there had been difficultymaintaining the appropriate chlorine levels and that staff hadconcluded that the distribution system needed to have achlorine burn, a routine maintenance procedure for watersystems using chloramines to minimize biofilms. The staffwas initiating a chlorine burn of the distribution system andhad notified customers through door hangers. After thechlorine burn a new chloramines process would be initiated.STAFF REPORTSSupervisor Hord asked how the O&S transition was goingand was told that Tuesday of next week will be the finalreconciliation.7:18:39 PMThe Board asked if the aged receivables should be writtenoff rather than keeping them on the books. Chairman VanMeter asked if the Authority can put a lien on the propertywhen customers do not pay their bills and the Attorneyresponded positively. Mr. Van Meter said that the Authorityshould be exploring the application of liens more in itscollections. Attorney Davis responded that Bryant MillerOlive could look into it and report back because a lot ofissues are involved. The Board asked about the flagpolesand the palm trees and Mr. Wheeler informed them that Mr.Pelham was not here to report on that.There being no further business to come before the Board,Chairman Van Meter adjourned the meeting at 7:18 PM.ADJOURNED_____________________________Bruce R. Van Meter, Chairman______________________________Raul S. Banasco, Secretary

CATEGORY:Attachment(s):ConsentPrice Breakdown from WW DanielsAPPROVAL FOR EMERGENCY MANHOLE REPLACEMENT ON OAKWOODBOULEVARD IN BUENAVENTURA LAKESExplanation: The Board is requested to approve award of a construction contract to a TohoWater Authority continuing contractor, WW Daniels Construction, for the Emergency Manholereplacement in Oakwood Blvd. in BVL in the amount of $75,585.00.On Wednesday, December 8, 2010, Field Services received a call about a sinkhole near amanhole on Oakwood Boulevard in the BVL service area. Upon inspection, it was found thatthe manhole, which is approximately 15 Feet deep, had dropped and sheared off portions ofthe mains in each direction. It has also had severe leaks, which is what was causing thesinkhole to form. The road is heavily travelled by local residents. Field Services crews filled inthe sinkhole to secure it for the night.On Thursday, December 9, 2010, Field Services called WW Daniels (a current ContinuingServices Contractor to Toho Water Authority) to begin traffic control preparations for the areaaround the manhole. Assistance was needed from an outside contractor because of the depthof the manhole. It was imperative to perform the work quickly to prevent the road fromcollapsing, a major sewer spill, and many safety concerns for the public. WW Daniels wascontacted to begin work as soon as possible and to secure the area. The sinkhole wasaffecting the entire width of the road. The work included dewatering, traffic detours, andreplacement of the manhole and portions of the mains.Field Services coordinated with WW Daniels and the County to complete the work and openthe road back up to traffic as required by the County.The repair work took 11 days to complete. WW Daniels has completed the emergency workand submitted an invoice and price breakdown. This includes all labor, equipment, materials,and traffic control. Funding for this repair will come from 421-1335-536-46-06.Recommendation: Staff recommends approval of the payment to WW Daniels for theEmergency Manhole Replacement Oakwood Blvd. in the amount of $75,585.00. Funding forthis repair will come from 421-1135-536-46-06 operating budget.Emergency MH Replacement Oakwood Blvd.03.09.11bl7B

CATEGORY: ConsentAttachments: Resolution 2011-004Exhibit “A” Procurement Policies and Procedures ManualAPPROVAL OF UPDATES TO THE PURCHASING MANUALExplanation: The Authority’s purchasing and warehouse functions began operations in 2003as an outsourced function serviced by the City of Kissimmee through a Purchasing Agreementadopted by the Board under Resolution 03-022. The resolution adopted in 2003 allowed theAuthority to utilize and adapt its procedures to be consistent with the City of Kissimmee inorder to transact procurement activities. Over the last six years, the Authority has taken majorsteps towards operating a fully functioning Purchasing and Warehouse Department. Thesesteps included hiring staff, building a warehouse, and discontinuing the use of the City ofKissimmee’s financial system. Now that these steps are completed, an update is necessary tothe Procurement Policies and Procedures Manual. In addition, the Board has adopted newpolicies and/or amended existing policies that need to be consolidated into a manual.Key updates to the policies and procedures manual are;1. Updated policies and procedures to reflect that the Authority no longer relies on theCity of Kissimmee for procurement services2. Consolidated purchasing policies adopted by the Board over the past several years3. Updated policies and procedures in accordance with state law, where applicable4. Updated approval authority to be consistent with the organizational structure andposition title changesAdditionally, this update to the policy and procedures manual is one of several steps underway to address audit finding 2009-10 Organizational Changes and their Effect on InternalControls. This resolution updates all procurement policies and procedures that have takenplace to establish a fully functioning Purchasing and Warehouse Department.Counsel was consulted by Staff throughout the process and has reviewed the modifications tothe manual under consideration for approval.Recommendation: Staff recommends approval of Resolution 2011-004 –ProcurementPolicies and Procedures Manual.7C

PROCUREMENTPOLICIES AND PROCEDURESMANUALJanuary 2011

FORWARDThis manual contains instructions regarding policies, procedures, and practices for theprocurement of commodities, equipment and services for Tohopekaliga Water Authority (the“Authority”). The instructions are for guidance of all TWA personnel, as well as all bidders,vendors, offerors, prospective vendors, prospective bidders, prospective offerors or others whoparticipate in the TWA procurement process as well as Authority staff who participate in theactions and decisions relating to procurement in order to provide a more complete understandingof purchasing and materials management policies, procedures and practices.The intent of issuing this manual is to achieve of uniformity and efficiency in the procurement ofcommodities, equipment and services and as a means of training for Authority personnel and toconsolidate the procurement policies of the Authority into one document.The Executive Director shall have the authority to make changes to these operating procedureson a case to case basis, or as he/she may determine appropriate provided consistent with law andthe policy direction of the Board of Supervisors.This manual supersedes existing policies of the Authority and where inconsistent with existingAuthority resolutions or Board of Supervisors Policy direction, shall be construed to takeprecedence.

TABLE OF CONTENTSSECTION 1. GENERAL ..............................................................................................................11.1 Mission ..................................................................................................................... 11.2 Policy Statement ...................................................................................................... 11.3 Organization ............................................................................................................ 1SECTION 2. CODE OF ETHICS AND CONDUCT ..............................................................32.1 General ...................................................................................................................... 32.2 National Institute of Governmental Purchasing (NIGP) Code of Ethics ........ 6SECTION 3. RESPONSIBILITIES OF PURCHASING AND WAREHOUSEDEPARTMENT ............................................................................................................................73.1 Responsibility .......................................................................................................... 73.2 Purchasing Cycle .................................................................................................... 83.3 Employee Responsibilities in the Purchasing Cycle – Planning and LeadTime ........................................................................................................................ 10SECTION 4. PURCHASING PROCEDURES ......................................................................114.1 General .................................................................................................................... 114.2 Purchase Levels ..................................................................................................... 114.3 Approval Authority .............................................................................................. 114.4 Purchase and Stock Requisition .......................................................................... 124.5 Purchase Order ...................................................................................................... 124.6 PO Change Orders ................................................................................................ 124.7 Blanket Purchase Order (BPO)............................................................................ 13SECTION 5. METHOD OF SOURCE SELECTION ............................................................155.1 General .................................................................................................................... 155.2 Purchase Card ........................................................................................................ 155.3 Check Request ....................................................................................................... 155.4 Emergency Purchases ........................................................................................... 155.5 Sole Source /Single Source ................................................................................... 165.6 Request for Quote (RFQ)...................................................................................... 175.7 Invitation for Bid (IFB) ......................................................................................... 175.8 Request for Proposal (RFP).................................................................................. 175.9 Cooperative Purchasing (Piggy Backing) .......................................................... 185.10 Government Contracts ......................................................................................... 185.11 Shared Interest Cooperative Purchasing (SICOP)............................................ 185.12 Osceola County Purchasing Cooperative .......................................................... 18SECTION 6. INVITATIONS FOR BID (IFB) PROCEDURES ..........................................20

6.1 Requirements ......................................................................................................... 206.2 Bid Packages .......................................................................................................... 206.3 Pre‐Bid Conference ............................................................................................... 216.4 Bid Openings ......................................................................................................... 216.5 Issuance of Addenda ............................................................................................ 216.6 Bid Approval and Award .................................................................................... 226.7 Site Visits and Inspections ................................................................................... 226.8 Tie Bids ................................................................................................................... 23SECTION 7. REQUESTS FOR PROPOSAL (RFP) PROCEDURES .................................247.1 Requirements ......................................................................................................... 247.2 Proposal Packages ................................................................................................. 247.3 Pre‐Proposal Conference ...................................................................................... 257.4 Proposal Openings ................................................................................................ 257.5 Issuance of Addenda ............................................................................................ 257.6 Evaluation Criteria ................................................................................................ 257.7 Evaluation Committee .......................................................................................... 257.8 Evaluation of Proposals ....................................................................................... 267.9 Debriefing Session ................................................................................................ 28SECTION 8. PURCHASES OF PROFESSIONAL SERVICES (CCNA and NON‐CCNA) ...................................................................................................................................298.1 General .................................................................................................................... 298.2 CCNA ..................................................................................................................... 308.3 RFP Preparation .................................................................................................... 30SECTION 9. PURCHASES OF VEHICLES ...........................................................................309.1 Requirements ......................................................................................................... 30SECTION 10. OBTAINING QUOTES ...................................................................................3210.1 Price Reasonableness ............................................................................................ 3210.2 Order Splitting Prohibition .................................................................................. 3210.3 Quotes ..................................................................................................................... 3210.4 Freight Charges‐Shipping and Handling .......................................................... 32SECTION 11. VENDOR RELATIONS ..................................................................................3311.1 Guidance for Working with Vendors ................................................................ 3311.2 Fairness and Conflicts of Interests ...................................................................... 3311.3 Gratuities ................................................................................................................ 3311.4 Financial Commitments ....................................................................................... 3411.5 Communications ................................................................................................... 3511.6 Vendor Performance ............................................................................................. 35

11.7 Protest Procedures ................................................................................................ 3611.8 Public Disclosure ................................................................................................... 37SECTION 12. INVOICES AND RECEIPT OF ITEMS ........................................................3812.1 Receiving ................................................................................................................ 3812.2 Handling Invoices ................................................................................................. 3812.3 Taxes ....................................................................................................................... 39SECTION 13. SPECIFICATIONS ...........................................................................................4013.1 General .................................................................................................................... 4013.2 Types of Specifications ......................................................................................... 4013.3 Responsibility for Specifications ......................................................................... 4113.4 Development of Specifications ............................................................................ 4113.5 Revision of Specifications Due to Budget Constraints .................................... 4213.6 Contractual Terms – Not Included ..................................................................... 4213.7 Detail of Specifications ......................................................................................... 43SECTION 14. BONDS AND INSURANCE REQUIREMENTS .......................................4414.1 Types of Bonds and Requirements ..................................................................... 4414.2 Waiver of Performance and Payment Bonds .................................................... 4514.3 Acceptable Surety Companies ............................................................................ 4514.4 Insurance Requirements ...................................................................................... 4614.5 Indemnification Statement................................................................................... 46SECTION 15. SURPLUS PROPERTY ....................................................................................4715.1 Purpose ................................................................................................................... 4715.2 Responsibility ........................................................................................................ 4715.3 Classification of Surplus Property ...................................................................... 4715.4 Methods of Disposal ............................................................................................. 4715.5 Procedures .............................................................................................................. 4815.6 Sale of Materials .................................................................................................... 4915.7 Items Approved for Cannibalization ................................................................. 4915.8 Donation of Miscellaneous Surplus Property ................................................... 4915.9 Collection and Sale of Scrap Metals ................................................................... 50SECTION 16. PURCHASING CARD PROGRAM .............................................................5216.1 Introduction ........................................................................................................... 5216.2 Purpose ................................................................................................................... 5216.3 How It Works ........................................................................................................ 5316.4 Responsibility ........................................................................................................ 5316.5 Assignment and Control of the Purchasing Card ............................................ 5616.6 Purchasing Card Security .................................................................................... 57

16.7 Procedures for Making and Paying for Purchases ........................................... 6116.8 Disputes .................................................................................................................. 6216.9 Procurement of Travel and Related Expenditures ........................................... 64SECTION 17. CONTRACTS ....................................................................................................6617.1 Purpose ................................................................................................................... 6617.2 Contract Development, Approval, and Execution ........................................... 6617.3 Contract Monitoring/Administration ................................................................ 6817.4 Contract Change Order (Appendix G) .............................................................. 6917.5 Certificates of Insurance ....................................................................................... 70SECTION 18. PUBLIC NOTICES ...........................................................................................7118.1 Purpose ................................................................................................................... 71SECTION 19. RECORDS RETENTION ................................................................................7219.1 Purchasing Records .............................................................................................. 72SECTION 20. WAREHOUSE PROCEDURES ......................................................................7320.1 Purpose ................................................................................................................... 7320.2 Responsibilities ...................................................................................................... 7320.3 Equipment .............................................................................................................. 7320.4 Issue Procedures .................................................................................................... 7320.5 Receiving Procedures ........................................................................................... 7520.6 Replenishment Procedures .................................................................................. 7720.7 Inventory Procedures ........................................................................................... 7820.8 Storage Procedures ............................................................................................... 7920.9 Safety ....................................................................................................................... 8120.10 Security ................................................................................................................... 81SECTION 21. PREFERENCES .................................................................................................8221.1 Local Vendor Preference ...................................................................................... 8221.2 Drug‐free Workplace Preference ........................................................................ 8321.3 Other Preferences Mandated by State Law. ...................................................... 83SECTION 22. DEBARMENT OF BIDDERS .........................................................................8622.1 Purpose ................................................................................................................... 8622.2 Definitions .............................................................................................................. 8622.3 List of Debarred Contractors. .............................................................................. 8722.4 Effects of Debarment ............................................................................................ 8822.5 Continuation of Current Contracts .................................................................... 8822.6 Restrictions on Subcontracting. ........................................................................... 8922.7 Debarment .............................................................................................................. 8922.8 Causes for Debarment .......................................................................................... 89

22.9 Debarment Procedures. ........................................................................................ 9022.10 Period of Debarment ............................................................................................ 92SECTION 23. DEFINITIONS ..................................................................................................94

1.1 MissionTOHO WATER AUTHORITYPROCUREMENT POLICIES AND PROCEDURES MANUALSECTION 1. GENERALThe purpose of the Purchasing and Warehouse Department is to establish guidelines for theprocurement of goods or services for the ongoing operations of the Authority, to assist the UserDepartments in identifying, selecting, and acquiring needed goods and services in a consistent,efficient, and economical manner, and to establish procedures for warehouse requisitioning inaccordance with applicable local, state, and federal laws.1.2 Policy StatementThe Purchasing and Warehouse Department shall be responsible for timely procurement of allsupplies, goods or services necessary for the operation of the Authority except as set forth below.All purchases shall be in strict compliance to all applicable ordinances, statutes, or policies ineffect at the time of the purchase. Goods or services shall be of a quality suitable for theintended purpose and at the lowest possible cost. The Authority supports the philosophy ofcentralized procurement for all Authority purchases except:A. Materials or services that are less than $1,000 purchased by departments usingPurchase Cards or Check Requests;B. Professional services as provided in the Consultants Competitive Negotiation Act(CCNA);C. The negotiation for lease or acquisition of real property;D. Postage;E. Subscriptions;F. Travel;G. Permits;H. Utilities; andI. Training in cases where the option to formally solicit will be in the best interest ofthe Authority.1.3 Organization1|Page

The Authority’s Purchasing and Warehouse Department is part of the Business ServicesDivision. It operates under the supervision of the Executive Director and the Director ofBusiness Services as a function of the Business Services Division.This Division is also charged with the receiving, storage, issue, and inventory control of all itemsmaintained as warehouse stock. The Purchasing and Warehouse Manager directly supervises allpurchasing and warehouse operations.2|Page

SECTION 2. CODE OF ETHICS AND CONDUCT2.1 GeneralAcceptance of gifts at any time, of any nature from vendors is prohibited. Employees must notbecome obligated to any vendors and shall not conduct any business transaction on behalf of theAuthority from which they may personally benefit. The term “vendor” means a firm orindividual with whom the Authority has an existing contractual relationship or which hasresponded to a request for proposals or request for qualifications or other solicitation forproposals. This prohibition also extends to acceptance of a gift, whether or not made by vendors,when prohibited by Part III of Chapter 112, Florida Statutes (Florida’s Code of Ethics for PublicOfficers and Employees) or when the person giving the gift is required by that law to report thegift on a report made to the Florida Commission on Ethics.No Authority employee or officer, either for himself or herself or as agent for another or asstockholder, or owner in any other legal entity shall participate or benefit directly or indirectlyfrom any sale, purchase, lease, contract or any other transaction entered into by the Authority.No Authority employee or officer shall bid for, enter into or be in any manner interested in anyAuthority contract nor shall any employee or officer seek to influence the purchase of a productor service from any offeree. Such restrictions shall not be construed to restrict persons fromevaluating and appraising the quality and value of the product to be purchased or service to berendered where the person’s scope of employment contemplates advice and council with respectto the purchase. No Authority employee or officer shall receive any gift or benefit of any naturefrom prospective bidders. The avoidance of actual or apparent conflicts of interest is a primerequisite to the efficient and sound operation of government and maintenance of the public trust.All Authority employees shall adhere to the ethical standards contained in Chapter 112, Part III,Florida Statutes (the Code of Ethics for Public Officers and Employees), as well as thosecontained in the Authority’s governing legislation, Chapter 2003-368, Laws of Florida, asamended. These include but are not limited to:A. An Authority officer or employee may not directly or indirectly purchase, rent orlease any realty, necessity, goods or services for the Authority from a businessentity of which the officer or employee or the officer’s spouse or child is anofficer, partner, director, or proprietor, or in which he/she, his/her spouse, or childhas a material interest as defined by the Code of Ethics for Public Officers andEmployees.B. No officer or employee acting as a purchasing official, purchasing manager, orpurchasing technician may directly or indirectly purchase, rent or lease any realty,goods, supply or service from a business entity in which he/she, his/her spouse, orchild is an officer, partner, director, or proprietor or in which he/she, his/herspouse, or child (or any combination of them) owns a material interest. Nor may3|Page

a public officer or employee acting in a private capacity, rent, lease, or sell anycommodity, realty, goods or services to the Authority.C. Lobbying of evaluation committee members, Authority employees, or Boardofficials regarding Request for Proposals (RFP), Request for Qualifications(RFQ), Invitations for Bid (IFB) or contracts, during the pendency the selectionprocess or bid protest, by the bidder/proposer/protester or any member of thebidder’s/proposer’s staff an agent of the bidder/proposer/protester, or any personemployed by any legal entity affiliated with or representing an organization thathas responded to an RFP, RFQ, IFB, or contract or has a pending bid protest isstrictly prohibited either upon publication of the Invitation for Bid or othersolicitation or on such other date as may to be established by the Authority andshall be prohibited until either an award is final or the protest is finally resolvedby the Authority; provided, however, nothing herein shall prohibit a prospectivebidder/proposer from contacting the Purchasing and Warehouse Department toaddress situations such as clarification and/or questions related to the procurementprocess as outlined in bid documents. For purposes of this provision lobbyingactivities shall include but not limited to, influencing or attempting to influenceaction or non-action in connection with any RFP, RFQ, IFB or contract throughdirect or indirect oral or written communication or an attempt to obtain goodwillof persons and/or entities specified in this provision. Such actions may cause anyRFP, RFQ, IFB, or contract to be rejected.D. Certain provisions contained in Section 112.313, Florida Statutes authorizepurchases or sales otherwise prohibited by law which may apply and, which mayupon approval of the General Counsel and Executive Director, allow somedeviation from certain of these requirements. The most commonly usedexceptions are authorized below. Among these are exceptions for "sole source,""sealed competitive bid," rotation system," "emergency purchases," and "smallpurchases" outlined below:1. Emergency Purchase: An "emergency purchase" or contract must bemade in order to protect the health, safety or welfare of citizens in theservice area of the Authority. For a contract to be authorized based uponthe sole source of supply "exception,"2. Sole Source: the business entity must be the sole source of supply withinthe service area of the Authority and there must be full disclosure by theofficer or employee of his or her interest in the business entity to theBoard of the Authority prior to the transaction being authorized.3. Sealed Competitive Bids: The business is awarded under a system ofsealed, competitive bidding to the lowest or best bidder and:4|Page

a. The official or the official’s spouse or child has in no wayparticipated in the determination of the bid specifications or thedetermination of the lowest or best bidder;b. The official or the official’s spouse or child has in no way used orattempted to use the official’s influence to persuade the agency orany personnel thereof to enter such a contract other than by the meresubmission of the bid; andc. The official, prior to or at the time of the submission of the bid, hasfiled a statement with the Commission on Ethics, if the official is astate officer or employee, or with the supervisor of elections of thecounty in which the agency has its principal office, if the official isan officer or employee of a political subdivision, disclosing theofficial’s interest, or the interest of the official’s spouse or child, andthe nature of the intended business.4. Rotation System: Within the Authority the business is transactedunder a rotation system whereby the business transactions are rotatedamong all qualified suppliers of the goods or services within theAuthority.5. Small Purchases: The total amount of the transactions in theaggregate between the Authority entity and the Authority does not exceed$500 per calendar year.E. Section 7 of the TWA Legislature provides:Section 7. Conflicts of Interest Prohibited. No member, officer, agent, oremployee of the Authority, either for himself or herself or as agent for anyoneelse or as a stockholder or owner in any other legal entity, shall participate in orbenefit directly or indirectly from any sale, purchase, lease, contract, or othertransaction entered into by the Authority. For the purposes of this act, a direct orindirect benefit or participation shall mean a “special private gain or loss” asdefined in the Code of Ethics for Public Officers and Employees, part III ofchapter 112, Florida Statutes, and shall be determined in the same manner as thequestion of “special private gain or loss” would be determined for purposes of aviolation of section 112.3143, Florida Statutes, or its successor in function. Amember, officer, agent, or employee of the Authority may rely upon an advisoryopinion or determination of the State Commission on Ethics or the Authority’sgeneral counsel as to the question of whether or not there would be a specialprivate gain or loss, and such determination shall also be determinative of theability of the member, officer, agent, or employee to vote under the provisions ofthis act or of the conduct of the member, officer, agent, or employee under this5|Page

act. The violation of any provisions of this act is declared to be a criminal offenseand misdemeanor within the meaning of section 775.08, Florida Statutes, andshall be punishable as provided by general law. The provisions of this sectionshall be cumulative to any general laws of the state which are from time to timeapplicable to members, officers, agents, or employees of the Authority and whichrequire the disclosure of, or prohibit, conflicts of interest.F. No officer or employee of the Authority shall1. have or hold an employment or contractual relationship with any businessentity which is subject to the regulation of, or is doing business with theAuthority, nor shall any such officer or employee have or2. hold any employment or contractual relationship that will create acontinuing or frequently recurring conflict between his or her privateinterests and the performance of his or her public duties or that wouldimpede the full or faithful discharge of his or her public duties.Exceptions contained in Section 112.313, Florida Statutes authorize certainbusiness relationships otherwise prohibited by F. 1 and 2 above which may apply and,which may upon approval of the General Counsel and Executive Director, allow somedeviation from certain of these requirements.2.2 National Institute of Governmental Purchasing (NIGP) Code of EthicsA. The Purchasing and Warehouse Department supports the NIGP Code of Ethics(Appendix A) and adheres to their philosophy of protecting the public trust.6|Page

SECTION 3. RESPONSIBILITIES OF PURCHASING AND WAREHOUSEDEPARTMENT3.1 ResponsibilityThe concept of centralized purchasing makes the Purchasing and Warehouse Department theagent for all departments of the Authority in matters related to the procurement of supplies andservices unless otherwise authorized. Responsibilities include:A. Determining present and future needs for goods or services with the support of alldepartments;B. Identifying repetitive or common use purchases for review and consideration forbulk bids or term contracts;C. Maintaining liaison with other municipality Purchasing Departments for possiblecooperative purchase agreements on existing contracts;D. Initiating reports necessary for analysis of Purchasing and Warehouse Departmentperformance;E. Assisting departments in preparing specifications for equipment, materials,commodities and services;F. Assisting departments in administration of contracts and cure process whenapplicable;G. Promoting goodwill between the Authority and its suppliers;H. Procuring the highest quality of supplies and services that is consistent with theneeds of and at the expense to the Authority;I. Keeping informed of current developments in the field of purchasing, prices,market conditions and new products;J. Providing training in purchasing policies and procedures to all User Departmentsas required;K. Providing support among departments by becoming acquainted with the needs ofeach and locating the sources of needed products or services;L. Reviewing the quality, quantity and kinds of goods and services requested andrecommending alternatives, if appropriate;7|Page

M. Ensuring procurement actions are properly documented and maintain all relatedrecords; andN. Discouraging collusive bidding and to endeavor to obtain as full and opencompetition as possible on all purchases and sales.3.2 Purchasing CycleThe Purchasing Cycle covers all activities associated with purchasing goods and services for theAuthority use. Understanding this cycle provides employees with information needed to take amore active and informed role in purchasing activities. The steps are as follows:A. PlanningB. Initiation1. Recognize the need and the best approach to meet it.2. Budgeting/identify funding source for service or goods.3. Understand the goal and desired result.1. Requisition entered for items over $1,0002. Information sent to Purchasing and Warehouse Department for purchasemethod recommendationRequest for Quote (RFQ)Invitation for Bid (IFB)Request for Proposal (RFP)Piggyback agreementOther governmental contractsC. Solicitation8|Page

D. Award1. Purchasing and Warehouse Department and User Department preparessolicitation document.2. Solicitation document is reviewed and approved by User Department.3. Solicitation document is publically advertised.1. IFB - Purchasing and Warehouse Department receives and tabulates bids.Purchasing and Warehouse Department and User Department review bidsto determine the lowest responsive and responsible bidder.2. RFP – Purchasing and Warehouse Department receives proposals andreviews for compliance. Review is completed with an evaluationcommittee.3. Recommendation to award is submitted to the Executive Director forpurchases up to $50,000. Purchases over $50,000 are submitted to theBoard of Supervisors.4. Vendor is notified of award.5. Requisition is entered in Paramount for financial review.6. Purchase Order and/or contract are issued to the vendor.E. Contract Management1. User Departments are responsible for managing contracts to ensurevendors comply with the requirements stated in the solicitation, contract,and that the payment is made in an adequate amount of time.F. Disposal1. The Purchasing and Warehouse Department will be responsible for theproper disposal of items.2. Disposal of items are done through online auction, bid, or donation.3. Once item is disposed, documentation is forward to the Accounting andFinance Department so items can be removed from asset list.9|Page

3.3 Employee Responsibilities in the Purchasing Cycle – Planning and Lead TimeA. Employees need to communicate their procurement needs to the Purchasing andWarehouse Department well in advance of time the good or service is required.For a formal solicitation, employees should plan for a two-week review period.B. Requisitions should have the appropriate quotes documented and noted in the“Internal Comments” field for Purchase Requisitions.C. Payment approval and invoices should be forwarded to the Accounting andFinance Department.10|Page

SECTION 4. PURCHASING PROCEDURES4.1 GeneralThe Purchasing and Warehouse Department will require written documentation according to theconditions listed below and will also verify the undocumented quotations according to theconditions listed below. Proof of these verifications will be maintained by the Purchasing andWarehouse Department for audit purposes and any potential for concern will be reported to theExecutive Director.4.2 Purchase LevelsAny procurement not expected to exceed $15,000 in expenditure of public funds, from anysource, shall be in accordance with the following purchase limits:$1,001- $4,000: Three (3) competitive telephone quotes will be required. Written documentationof the quotes is not required. The person securing the quotations will note the quotes in the“Internal Comments” field for a Purchase Requisition in Paramount. Departments areresponsible for maintaining the documentation for quotes entered in Paramount for PurchaseRequisitions.$4,001 - $15,000: Three (3) written quotes are required from the User Department and shall beattached to the Purchase Requisition in Paramount. Departments are responsible for maintainingthe documentation of quotes entered in Paramount for Purchase Requisitions.$15,001 and over: Sealed Bid or Proposal.4.3 Approval AuthorityAll purchases shall require approval from the Director of Engineering, Director of BusinessServices, Assistant to the Executive Director, Director of Treatment Operations, Director ofField Operations, Director of Human Resources, Customer Service Manager, LaboratoryManager, Comptroller, Finance Manager, Information Technology (IT) Manager and OperationsSupervisors in the amounts specified below:$1,001 - $5,000: Operations Supervisors and Laboratory Manager$1,001 - $10,000: Comptroller, Finance Manager, Customer Service Manager and ITManager$1,001 - $25,000: Director of Engineering, Director of Business Services, Director ofTreatment Operations, Director of Field Operations, Director of HumanResources, and Assistant to the Executive Director11|Page

All purchases shall require approval from the Deputy Executive Director, Executive Director, orBoard of Supervisors in the amounts specified below:$25,001 - $50,000: Executive Director and Deputy Executive Director$50,001 and over: Board of SupervisorsThe Purchasing and Warehouse Department shall be notified before any purchase isforwarded to the Board for approval.4.4 Purchase and Stock RequisitionThis procedure can be done through Paramount. IT must first be contacted to arrange access forthe appropriate menus. The Accounting and Finance Department will assign RequisitionApproval Authority to the Department Head or his authorized representative.Specific approval authority for certain categories of items such as computer hardware/software,radio equipment, or telephone communication equipment is required. Requisitions not incompliance with these requirements will be returned to the Requestor for correction.Financial review of all requisitions over $1,001 is required before the requisition is released tothe Purchasing and Warehouse Department. Requisitions not in compliance with currentfinancial guidelines will be returned to the department for correction.4.5 Purchase OrderA Purchase Order (PO) is a legal document to a vendor approving the purchase, payment, andshipping of services, equipment or supplies. It is only issued upon approval of a PurchaseRequisition submitted in Paramount.Only the Purchasing and Warehouse Department shall issue POs. Requisitions for materials orservices shall be sent to the Purchasing and Warehouse Department. Other User Departmentsshall not enter into obligations with vendors.Once a PO is issued, it will automatically be emailed to the vendor grantedthere is an email address on file for the vendor. If an email address is not onfile, the Requesting Department will be notified and a copy of the PO will beemailed to the Requesting Department for distribution to the vendor.4.6 PO Change OrdersThese requests may be sent either through email or manually by sending a copy of the PO withthe changes indicated on it or by memo explaining the changes. Change Order requests must besigned by an individual authorized to sign Purchase Requisitions. Any authorized change to theoriginal order is accomplished by means of a PO Change Order. It is prepared and issued by the12|Page

Purchasing and Warehouse Department. The department will receive a copy of the executed POChange Order.4.7 Blanket Purchase Order (BPO)A Blanket Purchase Order (BPO) is an agreement that simplifies the purchase of repetitiverequirements for similar products or services. The BPO alleviates the necessity of issuingnumerous POs. A period of time, which is usually one (1) year and a not-to-exceed dollaramount, will be specified prior to the approval of the BPO.A. Placing the Order1. A BPO is initiated with a requisition.2. The BPO should include a general description of the service.3. The BPO should reference the Invitation for Bid (IFB) that the BPO wasissued against.4. After the BPO is issued, the department is authorized to place orders whenneeded via telephone, email, and fax or in person directly with thesupplier.5. The User Department shall be responsible for acknowledging receipt ofgoods and approval of payment.B. Purchasing1. The Purchasing and Warehouse Department may monitor all or selectedpurchases to ensure adherence to the Authority’s procedures.2. Appropriate action will be taken if User Departments are not incompliance with the Authority’s procedures.C. Payment1. Partial payments are made as items are purchased against the BPO untilthe dollar amount encumbered is reached.2. User Departments must approve invoices pending approval in SmartClient to ensure that payment is made in a timely manner.D. User Department13|Page

1. BPOs shall be monitored very closely by the User Department as toexpenditures so as not to exceed the encumbered amounts.14|Page

SECTION 5.METHOD OF SOURCE SELECTION5.1 GeneralThe Purchasing and Warehouse Department will provide procedures for the selection of sourcesthat will ensure efficient purchasing in an accurate and timely manner.5.2 Purchase CardSelected Authority personnel may be issued Purchasing Cards to use for small purchases andemergency procurements under $1,000. All Purchasing Card transactions shall conform to theAuthority’s Purchasing Card Policies and Procedures, Section 19.Each individual that is granted a Purchasing Card will be required to take a Purchasing CardTraining Quiz and sign a Purchasing Cardholder Agreement. The quiz is comprised of variousquestions which pertain to the Purchasing Card Policies and Procedures and Purchase CardDatabase Program. Training and administering of the quiz will be given by the Purchasing andWarehouse Department. Upon passing of the quiz and signing of the Cardholder Agreement,the Purchasing Card will be issued.5.3 Check RequestA check request is designed to expedite the payment of expenditures that are not required to beprocessed on a standard Purchase Order. A Check Request shall be used for processing paymentwhen the Purchasing Card cannot be used or payment is less than $1,000.5.4 Emergency PurchasesDefinition: a purchase made in an emergency, often made under special procedures, designed tomeet the urgency.This type of purchase occurs when there is an unforeseeable breakdown in machinery, athreatened termination of an essential service, development of a dangerous condition or thecircumstances causing curtailment or diminution of an essential service. Emergency purchasesare costly and the use of this type of purchase due to failure to anticipate normal needsmust be avoided.Emergency purchases may be declared by the Department Director or his authorizedrepresentative only when normal operations would be critically affected by requesting a POthrough normal process.During normal business hours the User Department should contact the Purchasing andWarehouse Department on the extent of the emergency and to get approval for contacting thevendor. If necessary, the Purchasing and Warehouse Department will prepare an Intent to15|Page

Purchase Form that will be forwarded to the vendor by the User Department so the order can beplaced. All documentation should be forwarded to the Purchasing and Warehouse Departmentupon completion. A Purchase Requisition should be entered in Paramount with the option“Emergency” selected.Following each emergency purchase, an Emergency Purchase Form (Appendix C) shall beprepared with completed documentation, clearly stating the justification for an exception fromnormal purchasing procedures and submitted to the Purchasing and Warehouse Departmentwithin a 72-hour period after the occurrence.If an emergency occurs at a time other than regular Authority business hours, the sameprocedures will apply except contacting the Purchasing and Warehouse Department. TheDepartment Director is authorized to make purchases without competitive bids to protect thehealth, safety, welfare, or property of the Authority or any of its customers with the authorizationof the Executive Director.Emergency procurements greater than $15,000 shall require the Executive Director’s approvaland procurements over $50,000 requires document justification along with an agenda request andforwarded to the Board of Supervisors as an informational item.Departments should make every effort, depending on the circumstances, for competition. ThePurchasing and Warehouse Department will be available should assistance be needed.See Section 2.1 D(2) for the requirement imposed by State law for emergency purchases.5.5 Sole Source/Single SourceSole Source Definition: A sole source purchase exists due to the inability to obtain competitionwhich may result because only one (1) vendor or supplier possesses the unique ability orcapability to meet the particular requirement of the solicitation.Competition is not available in a sole source situation. Sole source justification based solely ona single vendor’s capability to deliver in the least amount of time is not appropriate sinceavailability alone is not a valid basis for determining sole source procurement.Single Source Definition: A single source purchase exists when purchases are directed to one (1)source because of standardization, warranty or other factors, even though other competitivesources may be available, this situation makes it impossible to obtain competitive bids.A Sole/Single Source Approval Form (Appendix D) should be filled out by the RequestingDepartment and submitted to the Purchasing and Warehouse Department along with supportingjustification. Supporting justification shall consist of a letter from the vendor stating sole sourcestatus. All sole source procurements require the Purchasing and Warehouse Department’s16|Page

approval and should be noted in the “Internal Comment” field for Purchase Requisitions. Allsole source procurements are valid one (1) year from approval date.In the event of the purchase meeting the dollar threshold required for a formal bid/proposal, aNotice of Intent to Sole Source shall be prepared by the Purchasing and Warehouse Departmentand advertised to the public for seven (7) business days. This will allow vendors who feel theycan provide a similar service to submit their justification in writing. If it is determined by thePurchasing and Warehouse Department and the User Department that other vendors can providethe same service, a formal bid/proposal will be prepared.See Section 2.1D(ii) for the requirements imposed by State law for "sole source" purchases.5.6 Request for Quote (RFQ)The Purchasing and Warehouse Department may issue a Request for Quote (RFQ) for purchasesup to $15,000 in an effort to negotiate and support competitive/best pricing for the Authority.This method is utilized if the expected dollar amount is relatively small, but exceeds thethreshold for written quotes and requires some level of competitive pricing.The RFQ will be advertised on Demand Star by Onvia for seven (7) days. Quotes may beopened and tabulated upon receipt. Responses may be received by fax or in writing and must bereceived at the Purchasing Office by the date and time specified. Award will be made to thelowest responsive and responsible vendor. If a vendor offers an alternative (not equal) that thePurchasing and Warehouse Department and the User Department determines would be in thebest interest of the Authority then each vendor contacted for the RFQ will be provided with therevised requirement and allowed to submit another quote.5.7 Invitation for Bid (IFB)The Purchasing and Warehouse Department may issue an Invitation for Bid (IFB) for purchasesover $15,000. This method is also known as sealed competitive bidding and is the preferredmethod of procuring a good or service. Award is made to the lowest responsive and responsiblebidder and is based solely on the specifications set forth without negotiation or discussion withthe vendor.An IFB shall either be advertised publicly on Demand Star by Onvia or in a newspaper ofgeneral circulation for at least ten (10) days prior to the date bids are due.5.8 Request for Proposal (RFP)The Purchasing and Warehouse Department may issue a Request for Proposal (RFP) forpurchases over $15,000. If this method is utilized, it is not practicable to define the scope ofwork for which commodities or contractual services are required with sufficient specificity for an17|Page

IFB and the Purchasing and Warehouse Department seeks a responsible vendor to proposecommodities or contractual services that meet the scope of the solicitation.An RFP shall be advertised publicly on Demand Star by Onvia or in a newspaper of generalcirculation, or both, for at least ten (10) days prior to the date proposals are due.5.9 Cooperative Purchasing (Piggy Backing)The Authority may participate in, sponsor, conduct or administer a cooperative procurementagreement with one or more public bodies or agencies for the purpose of combiningrequirements to increase efficiency or reduce administrative expenses. The objective ofcooperative purchasing with other public entities is to provide the Authority with the followingadvantages:A. Better prices due to larger volumeB. Better quality due to improved specificationsC. Savings in time and administrative costs5.10 Government ContractsThe originating department’s requirements may be fulfilled by procuring goods or services fromcontracts made available by State and Federal Government or other governmental agencies.When a requirement is made from such contracts, the Purchasing and Warehouse Department orUser Department must determine whether such goods or services meet the Authority’srequirements relative to price and quality resulting in the best value.5.11 Shared Interest Cooperative Purchasing (SICOP)The Shared Interest Cooperative Purchasing (SICOP) is a cooperative Purchasing committeeunder the Central Florida Chapter of the National Institute of Governmental Purchasing (CFC-NIGP). The objective is to achieve cost savings by combining requirements into cooperativecontracts, realize additional cost savings through reduction in administrative expenses and serveas a forum for the exchange of resources and technical information.Items may be purchased from bid or proposals advertised by the SICOP without furthercompetitive research. Items purchased from these bids will be subject to approval per thePurchasing and Warehouse Department Approval Authority levels.5.12 Osceola County Purchasing CooperativeThe Osceola County Purchasing Cooperative is a group of governmental and municipal agenciesin Osceola County, consisting of Osceola County, the School District of Osceola County, theCity of St. Cloud, Kissimmee Utility Authority, the City of Kissimmee and Toho Water18|Page

Authority, hereinafter referred to as the "Cooperative" that have joined together for the purposeof group purchasing.The main goals of this venture are to develop a cooperative front for the procurement ofcommodities and services, to share professional expertise and best practices, to build resourcesfor potential emergency assistance within the profession and to discuss other opportunitiesrelating to County-wide procurement. By combining resources and through volume purchasing,it is anticipated that the Cooperative will receive better pricing and gain efficiency as duplicationof effort is minimized.The specifications of the bids are developed by the Cooperative and one (1) agency will facilitatethe process as the lead agency on behalf of the Cooperative. The Cooperative believes that localgovernment agencies have a fundamental responsibility to the citizens and customers of theCounty to strive for excellence to develop programs that represent best practices and to beresponsible stewards of taxpayer’s dollars.19|Page

6.1 RequirementsSECTION 6. INVITATIONS FOR BID (IFB) PROCEDURESPurchases that are expected to be over $15,000 shall be procured through the issuance of anInvitation for Bid (IFB). Items to be procured shall be submitted to the Purchasing andWarehouse Department in the same manner as any other purchase request except that theRequesting Department will be responsible for submitting detailed, non-proprietaryspecifications for the items desired with the purchase request.The Purchasing and Warehouse Department will review the specifications and develop a formalbid package to be returned to the Requesting Department for review and final approval. Uponapproval, the Purchasing and Warehouse Department will provide the information to prospectivevendors by advertising in the local newspaper or, posting on Demand Star by Onvia to assureincreased competition.6.2 Bid PackagesFormal bid packages will at a minimum contain the following:A. A cover sheet specifying the item being bid, the due date and time, pre-bidinformation, bid deadline and place to submit the bid.B. General Terms and Conditions covering the general requirements of the bid.C. Technical specifications describing the materials or services desired.D. Bid Form.E. Special Terms and Conditions covering special items not mentioned in theGeneral Terms and Conditions.F. Notice to Bidders Statement.G. Drug Free Workplace Statement.H. Public Entity Crime Statement as provided for by § 287.133, Florida Statutes.20|Page

6.3 Pre-Bid ConferenceA pre-bid conference may be required for bids that are technical or complex. The conference isheld several days after the issuance of the solicitation. This intent is to exchange informationbetween the Authority and potential bidders at the same time to discuss details of the solicitation,including the scope, deliverables, and expectations. Potential bidders may use this to clarify anyinformation they may need to submit a responsive and responsible bid.A mandatory pre-bid conference may be required at the discretion of the Authority when deemedto be in the Authority’s best interest to do so. The User Department will justify the need for sucha requirement to the Purchasing and Warehouse Manager. Mandatory conferences are held toensure that potential vendors understand the complexity of the project or scope of service neededto provide the work herein. Mandatory conferences may however, hinder competition. If aspecification is written concisely, there should be very little need for a mandatory conference.All attendees at the conference are required to sign in with their names, firms they represent,telephone and fax numbers and email addresses. Questions are recorded. If attendance is notmandatory, the questions and their responses are distributed to all potential bidders. Addendawill be issued and distributed with all questions and answers to all registered bidders that havereceived the original bid solicitation.6.4 Bid OpeningsBids will be opened publicly and read aloud in the presence of at least two (2) Authorityemployees at the time, date, and place specified on the cover sheet. Bid results will be enteredon a bid tabulation form and distributed to all registered bidders that received the original bidsolicitation.6.5 Issuance of AddendaAn addendum is a revision or amendment to the bid documents. If an issue is raised at the prebidconference by a prospective bidder that requires a revision to the specification or solicitationdocuments, the revision is made in a written addendum. Verbal changes must not be made andinterpretations of a material consequence must not be made verbally to potential bidders. Anysuch prohibited verbal changes or interpretations will not be considered valid. The followingrequirements must be met for issuance of an addendum:A. The User Department or Project Manager shall submit to the Purchasing andWarehouse Department for review and approval all proposed addenda.21|Page

B. In no instance shall consultants working on behalf of the Authority issue anaddendum without the prior review and approval of the Purchasing andWarehouse Department.C. The Purchasing and Warehouse Department shall process the proposed addendapromptly upon receipt and distribute to all potential bidders.Prior to issuing an addendum, the Purchasing and Warehouse Department and the UserDepartment must consider the period of time remaining until bid opening. If additional time islikely to be required by the bidder, the addendum should extend the opening date for areasonable period of time to obtain the greatest level of competition and fairness to the potentialvendor.The bidders will be notified electronically within five (5) working days (unless otherwise stated)of the scheduled bid opening date and have a right to be present. Bidders must acknowledgereceipt of all addendums in their bid submittal at the designated time, date, and location. Bidsmay be rejected due to failure of vendors to acknowledge receipt of addendums. The Purchasingand Warehouse Manager, however, has discretion to not consider an addenda material to a bidprocess and may consider a bid responsive without an addenda acknowledgement.6.6 Bid Approval and AwardBids will be evaluated based on the criteria set forth in the bid. The Purchasing and WarehouseManager will review the bids received and make a recommendation to the RequestingDepartment. The Requesting Department will review the bids received considering thePurchasing and Warehouse Manager’s recommendation and either concur or consult with thePurchasing and Warehouse Manager to resolve differences.The Purchasing and Warehouse Manager will submit a Bid Approval Memo for the ExecutiveDirector’s approval if the total amount is less than $50,000. If over $50,000, the Purchasing andWarehouse Manager will prepare an Agenda Item Request to be submitted to the Board forapproval.A Notice of Award will be publicly advertised upon receipt of all prospective signatures. Thereis no mandatory or formal requirement to provide the Notice of Award to all unsuccessfulbidders, but total notification is a good business practice and a courtesy. Therefore, thePurchasing and Warehouse Department will seek to notify all unsuccessful bidders.6.7 Site Visits and InspectionsIt may be a requirement for bidders to inspect the proposed work location prior to bidding. TheUser Department will be available to direct bidders to the general work areas by appointment.Bidders are required to contact the Purchasing and Warehouse Department and set up a site visitfor each location listed; this information is provided in the bid documents.22|Page

The site visit may be conducted by the User Department and may be included in the pre-bidconference. The site visit allows the potential bidder to become familiar with a particularlocation in which the work is to be performed.6.8 Tie BidsIn the event two (2) or more vendors submit the lowest and best bids, price and serviceconsidered, the bids shall be awarded by drawing lots in public.23|Page

7.1 RequirementsSECTION 7. REQUESTS FOR PROPOSAL (RFP) PROCEDURESPurchases that are expected to be over $15,000 and scope of work or specifications that are notclearly defined may be procured through the issuance of a Request for Proposal (RFP). Factorsother than price, such as qualifications, experience, project approach, innovation, and creativityare taken into consideration when making the decision to award. Items to be procured shall besubmitted to the Purchasing and Warehouse Department in the same manner as any otherpurchase request except that the Requesting Department will be responsible for submitting ageneral scope of services.The Purchasing and Warehouse Department will review the scope of services and develop aformal proposal package to be returned to the Requesting Department for review and finalapproval. Upon approval, the Purchasing and Warehouse Department will provide theinformation to prospective vendors by advertising in the local newspaper or posting on DemandStar by Onvia to assure increased competition.7.2 Proposal PackagesFormal proposal packages will at a minimum contain the following:A. A cover sheet specifying the item being offered, the due date and time, preproposalinformation, proposal deadline and place to submit the proposal.B. General Terms and Conditions covering the general requirements of the proposal.C. Technical specifications describing the materials or services desired.D. Proposal evaluation criteria.E. Proposal Form.F. Special Terms and Conditions covering special items not mentioned in theGeneral Terms and Conditions.G. Notice to Offerors Statement.H. Drug Free Workplace Statement.I. Public Entity Crime Statement. See §287.133, Florida Statutes.J. Draft Contract24|Page

7.3 Pre-Proposal ConferenceRefer to Section 6.37.4 Proposal OpeningsThe names of the offerors that submitted proposals will be read publicly in the presence of atleast two (2) Authority employees at the time, date, and place specified on the cover sheet.7.5 Issuance of AddendaRefer to Section 6.57.6 Evaluation CriteriaEvaluation criteria definition: guidelines that aid in assessing responses to an RFP. Thesecriteria enable the User Department to standardize the project criteria to be considered duringeach evaluation committee member’s evaluation of the proposal and provide potential offerorswith an understanding of how the proposal will be reviewed, both individually and incomparison with other proposals.When establishing the evaluation criteria, the User Department must clearly identify the factorsrelevant to its selection of a contractor and then weigh these factors according to theirimportance in satisfying the need of the purchase. The evaluation criteria shall be individuallytailored to each RFP and not be so restrictive as to limit competition.Evaluation criteria that may be used are price, personnel qualifications, experience and pastperformance. The User Department should realize that although price is included, it should notbe the sole determining factor for an award.7.7 Evaluation CommitteeAn Evaluation Committee shall be established by Executive Director and operate in compliancewith Florida’s Government in the Sunshine Law. Procedures of the Committee shall not be quasijudicial in nature. The Evaluation Committee is advisory.25|Page

7.8 Evaluation of ProposalsGeneral: The goal of the evaluation committee is to determine in a fair and consistent manner therelative merits of all proposals received in response to the RFP. Each evaluator must becomefamiliar with the entire contents of the RFP. At least three (3) evaluators are recommended. Anodd number of evaluators are preferred. The Purchasing and Warehouse Manager will be thesole intermediary between the committee and vendors and will act as the committee chairperson,facilitate committee meetings and shall be available to answer procedural questions. ThePurchasing and Warehouse Manager shall be neutral in the evaluation process.Initial Abstract: The Purchasing and Warehouse Manager will first abstract the proposals,checking to make sure all proposals meet the proposal format as prescribed in the RFP and ifbonds are required, that bonds are received in good order. The Purchasing and WarehouseManager will retain all originals of the proposals and distribute the necessary copies to theevaluation committee once abstracting is complete.No Conflict of Interest: Once the proposals have been received and it is clear which companiesare involved in the RFP, each member of the evaluation committee must sign a Responsibility ofEvaluation Committee Form. The evaluation committee chairperson will provide this form.These forms must be signed before any committee members receive copies of the RFPs.Confidentiality: Certain documents received as part of an RFP may be determined to containproprietary information protected from public view and exempt from production underFlorida’s Public Records Act. General Counsel should be consulted concerning any requestfor confidentiality. If such documents are present, each member of the RFP evaluationcommittee must maintain the confidentiality of these documents during and after the RFPevaluation process.Do not share proposals, rankings, and evaluation materials outside the evaluation committee untilthe selection process is complete and the contract is awarded.Individual Scoring: Evaluation committee members are provided with copies of each RFP tobegin their individual review of the proposals.Step One: Review all proposals. Take notes, make comments or prepare questions fordiscussion. Do not necessarily score at this point.Step Two: Determine status. Determine whether each proposal is "responsive" or "nonresponsive."A "responsive" proposal conforms in all material respects to the RFP and ALLMANDATORY REQUIREMENTS HAVE BEEN MET. A proposal may be deemed "nonresponsive"if any of the required information is not provided, the submitted price is found to beexcessive or inadequate as measured by criteria stated in the RFP, or the proposal is clearly notwithin the scope of the project described and required in the RFP. Extreme care should be usedwhen making this decision because of the time and cost that a proposer has put into submitting a26|Page

proposal. If a proposal is determined to be "non-responsive," provide a written justification forthis conclusion.Step Three: Score proposals. Each committee member may initially / informally scoreproposals independently from the other members. Score proposals based on the criteriaestablished in the RFP. Proposals must be evaluated solely on the stated criteria listed in theRFP. Include a written justification for each scoring category. A custom-scoring sheet, draftedby the evaluation committee and/or chairperson, may be provided to assist in the process ofawarding and totaling points.Evaluation Committee Meetings: Once the proposals have been evaluated and scored byindividual committee members, the entire committee shall meet in compliance with Florida'sSunshine Law to discuss the proposals and arrive at the final scoring. The committeechairperson, or assigned designee, shall take minutes of each meeting. These minutes shallinclude the date, time, place of meeting, a list of the evaluation committee members inattendance, as well as the substance of all matters discussed or decided and, a record byindividual members of any votes taken. All committee members must be present to take anyofficial action. The minutes and all other minutes used in the evaluation process shall bemaintained as a public record.Step Four: Discuss proposals. The full evaluation committee should discuss all aspects of theproposals in a meeting held in compliance with the Sunshine law, so that there is a "unifiedunderstanding" of the criteria and corresponding responses. Any individual scores may beadjusted at this point based upon discussion. The committee may tally the final pointassignments by the following methods:1. Total of all of the points given by individual committee members.2. An average of the individual scores (extreme scores should be questionedand possibly thrown out).3. Any method or combination thereof is acceptable if agreed, to by allcommittee members.Any two or more members of the committee are prohibited by law from participating in anyconversation, regardless of means of communication, concerning any matter which may comebefore the Committee. All such communications, whether by e-mail, text message, telephoneconversation in person, or otherwise may only take place in a duly advertised meeting held incompliance with the requirements of Florida Sunshine Law.Step Five: Clarification. This step is optional. If the committee is unsure of certain items orissues included in an RFP response, it may at any time request further clarification from theproposer(s) through the Purchasing and Warehouse Manager. The Purchasing and WarehouseManager will distribute the clarification questions. Responses will be returned to the Purchasing27|Page

and Warehouse Manager and submitted to the evaluation committee. Clarifications must notmaterially alter the vendor’s original proposal.Step Six: Interview. This step is optional. If interviews are deemed necessary, the Purchasingand Warehouse Manager will issue a letter asking the proposer to attend the interview or give apresentation. This is an opportunity for the vendor to explain its proposal for clarification. Theinterview option must have been so stated in the RFP including appropriate scoring criteria.Interviews may not result in material deviations from the RFP or proposals.Step Seven: Cost Scoring. This step is only used when the cost is required to be submitted in aseparate envelope. The Purchasing and Warehouse Manager will review the committee scoringand justification for compliance to the RFP. The Purchasing and Warehouse Manager will thenopen and provide the cost proposals to the committee for review and determination that an "appleto apple" comparison can be made. The Cost Proposals are scored according to the RFPevaluation criteria, and the cost score will be added to the total score to determine an apparentwinner.Step Eight: Best and Final Offer (BAFO). This step is optional. A letter asking the proposer tosubmit a "Best and Final Offer" may be issued if the RFP allows it and if it is of additionalpossible benefit to the Authority (usually a need for clarification). Only the issuing officer maysend the BAFO at the request of the evaluation committee. A BAFO cannot be requested oncescores or cost information has been made public. Once a "Best and Final Offer" is received, thecommittee will evaluate it in the same manner as the original cost proposal.Step Nine: Recommendation and Award. The full evaluation committee makes a writtenrecommendation to the Executive Director or Board as to whom the contract should be awarded.This written recommendation should contain scores, justification and rationale for the decision,along with any other variables that may have been considered.Individual scoring sheets and any other material relating to the evaluation process must beprovided to the Purchasing and Warehouse Manager at the end of the evaluation process. Ifconsensus scoring is used, the consensus score sheets and any other material relating to theevaluation process must be turned in to the Purchasing and Warehouse Department.The Purchasing and Warehouse Manager will issue the required Intent to Award and, assumingno appeal, will issue a purchase order or vendor contract, as appropriate. A copy of the fullyexecuted contract will be retained in the RFP file. This completes the RFP solicitation process.7.9 Debriefing SessionUnsuccessful offerors may be permitted to have the opportunity of a debriefing session. Thedebriefing provides an opportunity for an offeror to receive a critical review of the losingproposal and be made aware of what, in the opinion of the evaluation committee, were its28|Page

strengths and weaknesses. A debriefing, however, may not be necessary since all committeemeetings are open to the public.29|Page

SECTION 8. PURCHASES OF PROFESSIONAL SERVICES (CCNA and NON-CCNA)8.1 GeneralThe purpose of this section is to establish a standard procedure for the selection of firmsproviding professional services to the Authority and includes, but is not limited to, those servicesdescribed in Section 287.055, Florida Statute known as the "Consultant’s CompetitiveNegotiation Act" ("CCNA").Professional Service Definition: assistance obtained in support of Authority operations from anindependent contractor in one or more of the following professional fields:A. Professional Architecture, Professional Engineering, Landscape Architecture, orRegistered Surveying and Mapping Services as defined by the laws of the State orthose performed by any architect, professional engineer, landscape architect, orregistered survey or mapper in connection with his or her professionalemployment or practice.B. Audit and Accounting Services – Auditors and AccountantsC. Consultants – Planning, Management, Rates, or Scientific AdvisorsD. Design Build – Those services described in Subsection (9) of Section 287.035,Florida StatutesE. Financial Services – Bond Counsel, Rating and Underwriting, Financial Advisor,and Investment ServicesF. Legal Services – Attorneys and Legal ProfessionalsG. Construction ManagersProfessional services for construction work estimated to cost more than $1,000,000 andprofessional services for "studies" estimated to cost over $50,000 must be obtained througha Request for Qualification (RFQ) and will be administered through the EngineeringDivision. Professional services, regardless of the price of the construction work or theprofessional services, governed by the CCNA, including Design Build Services will beobtained in conformity with that Act.The Purchasing and Warehouse Department will handle all professional services except appraisalservices, those covered under the CCNA, Financial Services and Legal Services. Thesepurchases will require that the same procedure be followed as those required for the purchase ofmaterials. Additionally, other professional services such as auditing, management consultants,and legal services fall under the specific Department Head approval. Approval for these services30|Page

must be coordinated with the Department Head and Executive Director since certain legalconstraints apply in some instances.8.2 CCNA The Authority will generally follow the Consultant’s Competitive NegotiationAct in selection of firms to provide those services listed in Section 8.1 for Professional Servicesnot governed by the CCNA but may deviate it allowed by law.Preparation of an initial Agenda Item Request by the User Department shall be done which:A. Explains the requested service, the scope of work and the anticipated length of thecontract.B. Justifies the need for the requested service.8.3 RFP PreparationDevelopment and distribution of an RFP document shall be coordinated between the UserDepartment and the Purchasing and Warehouse Department. Refer to Section 8 Request forProposal (RFP) Procedures for steps on how to prepare and evaluate an RFP.31|Page

SECTION 9. PURCHASE OF VEHICLES9.1 RequirementsAll vehicle purchases must be reviewed by and coordinated with the Purchasing and WarehouseDepartment prior to purchase. The Purchasing and Warehouse Department will view the FloridaState Contracts List and the Sheriff’s Contract List to check if the vehicle is listed. All vehiclespecifications must conform to those approved by the Authority. The Purchasing and WarehouseDepartment will take the following steps before purchasing a vehicle:A. View the new fiscal year vehicle budget.B. Submit formal bid for all vehicles listed on vehicle budget.C. Submit an Agenda Item Request for Board approval.D. Once the bid is closed, a meeting will be scheduled with each individualdepartment head to discuss pricing and method of ordering, i.e., dealer, StateContract List or Sheriff Contract List.E. Once a determination has been made, a Purchase Requisition will be entered inParamount with the Board approval date noted in the Internal Comments block ofthe requisition.F. A PO will be created and a copy will be forwarded to the vendor.All vehicles shall be shipped to Central Services, 100 N. Alaska Ave., Kissimmee, FL 34743between the hours of 8 a.m. – 3:30 p.m. Mon. – Fri. Notification should be made 24 hoursprior to delivery at 407-518-2522.NOTE: Each User Department is advised not to make any financial obligations to any vendorwithout first consulting with the Purchasing and Warehouse Department.32|Page

10.1 Price ReasonablenessSECTION 10. OBTAINING QUOTESThe Authority shall pay a fair and reasonable price for goods and services. This price is what awilling buyer would pay a willing seller. This applies to all purchases including those under$1,000.Determination of a fair and reasonable price can be made using a variety of sources such as acomparison with prices previously paid, prices charged for similar items, prices set from acommercial catalog, or estimates/quotes.10.2 Order Splitting ProhibitionSubmitting multiple requests within other than a reasonable time period for the same, like orrelated goods or services to avoid using the appropriate procurement method is prohibited.Order splitting is an inefficient practice and results in higher administrative costs to theAuthority.10.3 QuotesEither the User Department or Purchasing and Warehouse Department can obtain quotes.Authority employees should seek additional quotes if a price is not fair and reasonable. It’simportant to document the name and address of vendors contacted, the item description orservice offered, price quoted including shipping/freight, delivery dates, shipping point, names ofpersons giving and receiving the prices and the date the information was obtained. Don’t sharequotes from one vendor with other vendors before the quote process is complete and all thequotes have been received.10.4 Freight Charges-Shipping and HandlingWhen obtaining a quote, ask the vendor to quote FOB Destination (Free On Board Destination).FOB Destination is the Authority’s preferred shipping and handling method.FOB Destination definition: The vendor retains title to the goods until the goods are received bythe Authority. The vendor pays the shipping costs and is responsible for claims against thecarrier. Be sure to specify Inside Delivery if the item needs to be delivered indoors to an officebuilding or worksite.FOB Plant/Origin definition: The Authority accepts title for the goods from the moment it ispicked up by the carrier. The Authority pays shipping costs and is responsible for claims againstthe carrier. Occasionally a vendor may want to quote FOB Plant/Origin. FOB Destinationshould be quoted instead. Accepting a quote of FOB Plant/Origin has financial consequences forthe Authority if the shipment is lost or damaged.33|Page

11.1 Guidance for Working with VendorsSECTION 11. VENDOR RELATIONSAuthority employees are subject to the laws and policies that apply to all public employees. Allemployees involved in purchasing transactions shall conduct business with vendors in a fair andimpartial manner that avoids impropriety or the appearance of impropriety.11.2 Fairness and Conflicts of InterestsIt is important that the User Department representative does not share one vendor’s quote withanother vendor, and does not promise an order or show favoritism to a particular vendor.Avoiding conflicts of interests is also encouraged. Employees, relatives, friends, or other peoplesomehow involved with the purchasing process should not be considered as potential vendors.11.3 GratuitiesAccepting anything of value from a vendor, offeror or prospective vendor or offeror, isprohibited. Employees may attend vendor-sponsored seminars or trade shows where they willbenefit from receiving product information and learning about new techniques and product orservice trends. Food, drinks and give away items offered to all participants at such functionsmay be accepted by Authority employees attending if below the threshold for gift reporting bydonors contained in Part III of Chapter 112, Florida Statutes, and otherwise authorized by law.That threshold for donor reporting of gifts is currently $25.00. The rules of the FloridaCommission or Ethics or Authority General Counsel may be consulted with respect to thissubject matter. Part III of Chapter 112, Florida Statutes, Florida's Code of Ethics for PublicOfficers and Employees, contains a number of specific prohibitions on solicitation or acceptanceof gifts. Among these are the following:A. A reporting individual or procurement employee is prohibited from soliciting anygift from a political committee or committee of continuous existence, as definedin s. 106.011, or from a lobbyist who lobbies the reporting individual’s orprocurement employee’s agency, or the partner, firm, employer, or principal ofsuch lobbyist, where such gift is for the personal benefit of the reportingindividual or procurement employee, another reporting individual or procurementemployee, or any member of the immediate family of a reporting individual orprocurement employee.B. A reporting individual or procurement employee or any other person on his or herbehalf is prohibited from knowingly accepting, directly or indirectly, a gift from apolitical committee or committee of continuous existence, as defined in s.106.011, or from a lobbyist who lobbies the reporting individual’s or procurementemployee’s agency, or directly or indirectly on behalf of the partner, firm,employer, or principal of a lobbyist, if he or she knows or reasonably believes thatthe gift has a value in excess of $100; however, such a gift may be accepted by34|Page

such person on behalf of a governmental entity or a charitable organization. If thegift is accepted on behalf of a governmental entity or charitable organization, theperson receiving the gift shall not maintain custody of the gift for any period oftime beyond that reasonably necessary to arrange for the transfer of custody andownership of the gift.C. Solicitation or Acceptance of Gifts.—No public officer, employee of an agency,local government attorney, or candidate for nomination or election shall solicit oraccept anything of value to the recipient, including a gift, loan, reward, promise offuture employment, favor, or service, based upon any understanding that the vote,official action, or judgment of the public officer, employee, local governmentattorney, or candidate would be influenced thereby.D. The term "Lobbyist" means any natural person who, for compensation, seeks, orsought during the preceding 12 months, to influence the governmental decisionmaking of a reporting individual or procurement employee or his or her agency orseeks, or sought during the preceding 12 months, to encourage the passage,defeat, or modification of any proposal or recommendation by the reportingindividual or procurement employee or his or her agency.E. The term "Reporting Individual" means any individual, including a candidateupon qualifying, who is required by law, pursuant to s. 8, Art. II of the StateConstitution or s. 112.3145, to file full or limited public disclosure of his or herfinancial interests or any individual who has been elected to, but has yet toofficially assume the responsibilities of, public office. For purposes ofimplementing this section, the "agency" of a reporting individual who is not anofficer or employee in public service is the agency to which the candidate seekselection, or in the case of an individual elected to but yet to formally take office,the agency in which the individual has been elected to serve.F. The term "Procurement Employee" means any employee of an officer,department, board, commission, or council of the executive branch or judicialbranch of state government who participates through decision, approval,disapproval, recommendation, preparation of any part of a purchase request,influencing the content of any specification or procurement standard, rendering ofadvice, investigation, or auditing or in any other advisory capacity in theprocurement of contractual services or commodities as defined in s. 287.012, ifthe cost of such services or commodities exceeds $1,000 in any year.11.4 Financial CommitmentsIt is advised to not place an order without first obtaining the proper document such as a PurchaseOrder or a signed contract.35|Page

Financially committing the Authority to its vendor by signing a contract or a vendor’s proposalmay cause the Authority to become liable.Do not authorize any changes to a Purchase Order or a contract without notifying the Purchasingand Warehouse Department first. This may make the individual liable.Do not accept equipment as a loaner or evaluation without first contacting the Purchasing andWarehouse Department. The Purchasing and Warehouse Department will make arrangementswith the vendor concerning associated costs such as delivery and installation and the risk of lossor damage.Do not request or expect a vendor to provide layouts or design services without charge orobligation. Projects of this scope require the Department Head’s assistance.11.5 CommunicationsDo not communicate with vendors or offerors during a bid, proposal or other solicitation. Referall vendor communications to the Purchasing and Warehouse Department or the Departmentcontact person specified in the bid/proposal. The communication may result in information thatmust be shared with all vendors with an addendum.Also, be wary of unethical tactics by phone solicitors stating they can offer a deal on overstockeditems or that it is time to reorder supplies for your office equipment or copier. Refer these callsto the Purchasing and Warehouse Department.11.6 Vendor PerformanceAssuring proper performance by vendors requires cooperation and communication between UserDepartments and the Purchasing and Warehouse Department. Timely actions on the part of theUser Department and the Purchasing and Warehouse Department is required for enforcing theterms of Purchase Orders and contracts and protecting the Authority’s financial and legalinterests. Below are some ways to improve a vendor’s performance:A. Failure by vendors to deliver on time, in the proper quantities or to meetspecifications is a problem that must be handled in a prompt, uniform and fairmanner.B. In the event of a problem, the User Department should promptly contact thevendor to request resolution. A complete record should be made of the contact toinclude the name, title and telephone number of the person contacted and anypromises made by that person.C. If the vendor continues to be noncompliant after the first contact, contact thePurchasing and Warehouse Department.36|Page

D. The Purchasing and Warehouse Department will provide the vendor with aVendor Complaint Form (Appendix E) along with the complete record from theUser Department documenting that the situation needs to be cured. If the vendorfails to comply with the terms of the contract or order after this notice, thePurchasing and Warehouse Department may cancel the purchase order or contractand order from another source.E. Employees who fail to take prompt action to notify the vendor or the Purchasingand Warehouse Department of problems may create a constructive change to theterms of the contract and by this the employee is approving the vendor’s behavior.11.7 Protest ProceduresThe purpose of the protest procedures contained in a protest is to provide a process by which abidder, offendor or vendor may seek resolution of a disagreement they may have with theAuthority’s bidding procedures or awards. Vendors are encouraged to contact the Purchasingand Warehouse Manager to determine whether or not their concerns can be resolved prior toinitiating a formal protest. The following procedures shall be followed:A. Right to Protest: Only bidders or offerors that submit bids or proposals areeligible to submit a protest.B. Posting: The Purchasing and Warehouse Department shall post a recommendationof award at the location where bids or proposals were opened or on theAuthority’s website.C. Protest Submission: In the case of a protest of the specifications of a bid orproposal, the bidder, offendor or vendor shall file with the Authority a notice ofprotest in writing within 72 hours after receipt of the specifications and shall file awritten formal protest identifying the bid number, title, and basis for the protestwithin ten (10) days after the date of the notice.In the case of a protest of the bid award, the bidder, offendor or vendor shall filewith the Authority a notice of protest in writing within 72 hours after posting ofthe recommended award and shall file a formal written protest identifying the bidnumber, title, and basis for the protest within ten (10) days after the date of thenotice of protest. Failure to file a notice of protest or failure to file a formalwritten protest within the time frame specified shall not be considered.D. Receipt of Protest: A formal written protest is considered filed with the Authoritywhen it is received by the Purchasing and Warehouse Department.E. Authority to Resolve Protests: The Purchasing and Warehouse Manager shallhave the authority to settle and resolve a protest of an aggrieved bidder37|Page

concerning the solicitation or award of a contract by providing a written responseto the protesting bidder, offendor or vendor within seven (7) days (excludingSaturday and Sunday) after receipt of the formal written protest.F. Appeal Process: If the protest is not resolved by mutual agreement, the partyappealing may appeal to the Executive Director within seven (7) days (excludingSaturday and Sunday) following a decision by the Purchasing and WarehouseManager with an Appeal Bond. Appeals must be in writing with a copy providedto the Authority’s General Counsel and must specify in detail the reason for theappeal and any legal argument supporting the appealThe party appealing may appeal to the Board of Supervisors within seven (7) days(excluding Saturday and Sunday) following the Executive Director’s decision.Appeal to the Board of Supervisors is the final step within the Authority’sadministrative process and their decision is final. Vendors are responsible forfollowing the progress of their bids or appeals.Appeals will not be quasi judicial in nature. The Authority is exempt fromChapter 120, Florida Statutes, and appeals will not be determined pursuant toChapter 120.G. Stay of Procurements During Protests: In the event of a timely protest under thisSection, the Purchasing and Warehouse Manager shall not proceed further withthe solicitation or award of the contract until a written determination is made bythe Purchasing and Warehouse Manager and approved by the Executive Directoror until the Executive Director makes a determination for the record that theaward of a contract, without delay, is necessary to protect substantial interests ofthe Authority.11.8 Public DisclosureFlorida’s Public Records Law provides that Authority records shall at all times be open forpersonal inspection by any person. Information and materials received by the Purchasing andWarehouse Department in connection with a bid or proposal response shall be deemed to bepublic records subject to public inspection upon award, recommendation for award, or ten (10)days after bid opening, whichever occurs first or as may be provided by law. Certain exemptionsto the public records law are statutorily provided for in Section 119.07 Florida Statutes.If the vendor believes any of the information contained in his or her response is exempt from thePublic Records Law, then the vendor, must in his or her response, specifically identify thematerial which is deemed to be exempt and cite the legal authority for the exemption. TheAuthority’s determination of whether an exemption applies shall be final, and the vendor agreesto defend, indemnify, the Authority hold harmless and the Authority’s officers, employees, and38|Page

agents, against any loss or damages and attorneys' fees incurred by any person or entity as aresult of the treatment of records as public records.39|Page

SECTION 12. INVOICES AND RECEIPT OF ITEMS12.1 ReceivingDepartments have the authority and responsibility to inspect and accept goods and services onbehalf of the Authority. It is very important that employees responsible for receiving itemsensure that the quality and quantity received are the same as listed in the contract or PO. Goodsand services must be delivered on time, as specified and in the proper quantity or quality. Thefollowing steps should be taken to ensure the proper receipt of items:A. Verify the package is for the Authority. If not, delivery should not be accepted.B. Inspect the package for external damage.C. If external damage is found, the package should be opened immediately. Theemployee and the delivery driver should examine the contents together.D. If the entire value of the item is destroyed, delivery should not be accepted.E. Inspect the package for concealed damage; such as partial shipment, duplicateshipment or over shipment; or failure to deliver according to specifications. Ifany of these discrepancies occur contact the Purchasing and WarehouseDepartment immediately for assistance in filing a claim and returning the items.12.2 Handling InvoicesThe Accounting and Finance Department compares the PO from the open file against thevendor’s invoice for accuracy. An invoice should include the following:A. PO number or Contract NumberB. Date of order (if possible)C. Date of deliveryD. Itemized list of materials or services renderedE. Destination of deliveryF. Quantities, prices (both unit and total), terms and any other charges contained onthe POG. Delivery charges should be listed separately from the materials and supplies ifthey are not included in the unit price40|Page

The Accounting and Finance Department will then upload the invoice in Smart Client and anemail notification will automatically be sent to the Requesting Department for review andapproval. The approval stamp on the Smart Client invoice image indicates that the goods orservices being billed have been received. When in doubt, employees and vendors should beinstructed to forward all invoices to the Accounting and Finance Division.12.3 TaxesThe Authority is generally exempt from Florida Sales Tax. Exceptions include airline tickets,restaurant, and catering. Authority officers and employees are prohibited from making anyrepresentation to any vendor, contractor or offer regarding the exemption, if any, of that vendor,contractor or offeror from sales tax. The Authority cannot "lend" its sales tax exemption to avendor, contractor or offeror.41|Page

SECTION 13. SPECIFICATIONS13.1 GeneralThe purpose of a specification is to serve as a basis for obtaining a supply or service adequateand suitable for the Authority’s needs. This should be done in a cost effective manner, takinginto account the total cost of ownership and operation, as well as the initial acquisition cost. It isthe policy of the Authority that specifications permit maximum practicable competitionconsistent with its purpose. Specifications should be drafted with the objective of clearlydescribing the Authority’s requirements.13.2 Types of SpecificationsSpecifications take many forms, some of which are more complex than others. The types ofspecifications are:A. PerformanceB. DesignC. Combination of Performance and DesignD. Brand Name or Approved EqualE. Qualified Products List (QPL)F. StandardPerformance Specification: this type of specification is where the goods and/or services aredescribed in terms of required performance. They may include such details as required power,strength of material, test methods, and standards of acceptability and recommended practices.Design Specification: this is a detailed description of a good and/or service, including suchthings as details of construction or production, dimensions, chemical composition, physicalproperties, materials, ingredients, and all other details needed for the vendor to produce an itemof minimum acceptability. Design specifications are usually required for construction projectsand custom produced items and for many services.Combination of Performance and Design: contains elements of both design and performancespecifications. Some features of each are included to allow a vendor to use ingenuity to meet theperformance needs of the Authority and also to require certain necessary design characteristics.This is likely the most common type of specification.42|Page

Brand Name or Approved Equal: list a good and/or service by brand name, model and otheridentifying specifics, in order to limit the bidding to a single preferred product. Since this typeof specification discourages competition, it must not be used unless the item is the only onewhich will satisfy the Authority’s requirement. This type of specification is useful forpurchasing replacement parts where only the brand name item will work. An Approved Equalspecification will have products equal to the characteristics of the named brand as specified asacceptable.Qualified Products List (QPL): a QPL may be developed when testing or examination ofcommodities prior to issuance of the solicitation is desirable when necessary to best satisfy theAuthority’s requirements. When developing a QPL, a representative group of potential suppliersmust be solicited in writing to submit products for testing and examination to determineacceptability for including on a QPL. Any potential supplier, even though not solicited, mayoffer a product for consideration. Inclusion on a QPL must be based on results of tests orexaminations conducted in accordance with prior published requirements.Standard: a single specification for one or more goods and/or services that are ordered on arecurring basis and that have the same general purpose. The same specification is used each timean order is placed or bids are advertised. Examples are office supplies, paper, janitorial supplies,and copier service contracts. Standardized specifications will usually be more complete anddetailed than one time specifications.13.3 Responsibility for SpecificationsThe Purchasing and Warehouse Department has access to a library of current specificationsthrough the National Institute of Governmental Purchasing (NIGP) for equipment, commodities,materials and services.The User Department will prepare the technical specifications for equipment, materials,commodities, or services in accordance with the Purchasing and Warehouse Department. ThePurchasing and Warehouse Manager may make modifications or alterations to the specificationsto accommodate competitive bidding.13.4 Development of SpecificationsThe purchase description or specification should include the essential physical and functionalcharacteristics necessary to express the minimum requirements of the Authority, such as:A. Common nomenclatureB. Kind of material (i.e. type, grade, class, alternatives)C. Electrical data, if necessary43|Page

D. DimensionsE. Size or capacityF. Principle of operationG. Environmental conditionsH. Intended use to include location, operating conditions and acceptable productlevels within the range of products available in the commercial marketplaceI. Equipment with which the item is to be usedJ. Other pertinent information that further describes the commodity or servicerequiredGuidelines: the following are guidelines when developing specifications:A. State exactly what is desired in clear and concise terms.B. Provide the means or basis for monitoring deliveries for conformance with thespecifications.C. Avoid non-essential quality restrictions that add to cost and difficulty inprocurement without adding to utility and value.D. Avoid definitions that unnecessarily restrict competition.E. Conform to established commercial and industrial standards.13.5 Revision of Specifications Due to Budget ConstraintsShould it be determined, after bids have been opened that the bid received exceeds the budgetedamount and additional funds are not available, bids may be rejected. The scope of thespecifications may be revised in an effort to comply with the established budget and revisedspecification.13.6 Contractual Terms – Not IncludedSpecifications must not include any solicitation or contractual terms or conditions such as thetime or place for the bid opening, time of delivery, payment, liquidated damages, or qualificationof bidders. These clauses shall be included in the appropriate sections of the bid package, i.e.,Instructions to Bidders, Terms and Conditions, etc., which are the responsibility of thePurchasing and Warehouse Department.44|Page

13.7 Detail of SpecificationsBids and quotations should be based on concise but adequate specifications. Lengthyspecifications composed or designed solely for the purpose of eliminating competition other thanthose able to supply a particular brand name should not be used except when no other type ofspecification can be drawn. Specifications should be detailed enough to provide a basis for fulland fair competitive bidding upon a common standard and should be free from any restrictionswhich would limit competition.45|Page

14.1 Types of Bonds and RequirementsSECTION 14. BONDS ANDINSURANCE REQUIREMENTSExcept for professional services and/or construction work, bid/payment/performance bonds willnot normally be required. The Authority allows for the Executive Director to determine bondingrequirements or the waiver thereof for contracts of $100,000 or less, and the Board ofSupervisors to determine bonding requirements or the waiver thereof for contracts over$100,000, but up to $200,000. The types of bonds are as follows:A. Performance and Payment BondB. Bid BondC. Letters of CreditPerformance and Payment Bond: this type of bond is required in connection with contracts forrepairs, renovations, new construction and other public works in accordance with Chapter 255,Florida Statutes. It is executed by a surety, subsequent to award by the successful bidder toprotect the buyer from loss due to the bidder’s inability to complete the contract as agreed.For construction-management or design-build contracts, if the public owner does not include inthe bond amount the cost of design or other non-construction services, the bond may not beconditioned on performance of such services or payment to persons furnishing such services.Such a bond may exclude persons furnishing such services from the classes of persons protectedby the bond.This bond secures the fulfillment of all contract requirements. It shall be equal to 100% of thecontract price except for contracts in excess of $250,000,000 when the Authority determines thatbond in the full amount of the contract price is not reasonably available as authorized by Section255.05(1)(c), Florida Statutes.Bid Bond: this type of bond is issued at the discretion of the Purchasing and WarehouseManager. It is a sum of money or bond guaranteeing the bidder will not withdraw the bid for aspecified period of time, will furnish bonds as required and will accept the contract, if awardedor forfeit the deposit. It shall normally be 5% of the contract price for bids under $100,000 orcontinuing contractor bids. In the event of the withdrawal of said bid within said period, orfailure of a vendor to enter into a contract and provide the performance bond within the requiredtime frame, the bidder may be liable to the Authority for the full amount of the bid bond fordamages.The bid bonds will be returned to all bidders, except the successful bidder following the bidaward. However, during the evaluation and analysis of the bid responses, the Authority reservesthe right to retain the three lowest bid responses bid bond until award of that particular contract.46|Page

It is the responsibility of the Purchasing and Warehouse Manager to approve the return of bondsto unsuccessful bidders in a timely fashion after an award of purchase.Letters of Credit: this is a document issued by a bank authorizing the bearer to draw a specifiedamount from that bank or its agents. A letter of credit is often substituted for a performancebond unless prohibited by law, and is held until the fulfillment of all contract requirements. Theletter of credit must be irrevocable and made out to the Toho Water Authority.14.2 Waiver of Performance and Payment BondsThe Authority, at its discretion, may waive the performance and payment bond requirementwhen it is determined to be in the best interest of the Authority, unless otherwise prohibited byFlorida law. Section 255.05, Florida Statutes allows the performance and payment bond to bewaived for contracts of $200,000 or less. The Authority may determine to waive Bonds on acase by case basis.14.3 Acceptable Surety CompaniesWhen the contract amount of a project does not exceed $500,000 and when public funds areutilized for the project, a person, the Authority is required by law to accept, as surety for theproject, bid bonds, performance bonds, labor and materials payment bonds, or any other suretybonds which are issued by a surety company which fulfills each of the following provisions:A. The surety company is licensed to do business in the State of Florida;B. The surety company holds a certificate of authority authorizing it to write suretybonds in this state;C. The surety company has twice the minimum surplus and capital required by theFlorida Insurance Code at the time the invitation to bid is issued;D. The surety company is otherwise in compliance with the provisions of the FloridaInsurance Code; andE. The surety company holds a currently valid certificate of authority issued by theUnited States Department of the Treasury under 31 U.S.C. ss. 9304-9308.Surety companies will tenders proof of that compliance. All contract and bond requirements byState Law should be signed by a Florida Resident Insurance Agent.14.4 Insurance RequirementsPrior to commencing work, the contractor shall procure and maintain at the contractor’s owncost, for the duration of the contract and any extensions insurance against claims for injuries topersons or damages to property which may arise from or in connection with the performance ofthe work or services hereunder by the contractor, contractor’s agents, representative, employeesor subcontractors and any other insurance coverage required by the IFB or RFP.47|Page

Insurance requirements for all IFBs/RFPs will be determined by the Risk ManagementDepartment. Bid specifications and any pertinent information on potential liabilities will beforwarded to the Risk Management Department for review and recommendations.A Florida Resident Insurance Agent shall sign all contract, bonds, and insurance requirements byState Law. All insurance shall be obtained from an agency of an insurance company, whichagency shall have an established place of business in the State of Florida and be duly licensed toconduct business therein.14.5 Indemnification StatementIt is the Authority’s standard policy to require vendors and contractors who do business with theAuthority to indemnify the Authority.48|Page

SECTION 15. SURPLUS PROPERTY15.1 PurposeThe purpose of this section is to establish procedures for the transfer and disposal of excess andsurplus property consistent with the provisions of Chapter 274, Florida Statutes, as authorized forAuthority use by Subsection 10(I)(mm) of Chapter 2003-368, laws of Florida, as amended, (the"Authority Act") as well as other provisions of the Authority Act. The Authority shall seek tomaximize return to the rate payors from disposition of excess property classified as surplus bytransferring the property or disposing of it through a public auction, IFB, posted prices, or tradein,or donation. Having consideration for the best interests of TWA, the value and condition ofproperty classified as surplus, and the probability of such property’s being desired by theprospective bidder or donee to whom it may be offered, TWA may offer surplus property toother governmental agencies located in the TWA service area for sale or donation or may offerthe property to private nonprofit agencies as defined in s. 273.01(3) by sale or donation. If thesurplus property is offered for sale and no acceptable bid is received within a reasonable time,TWA may offer such property to such other governmental units or private nonprofit agencies asdetermined by the TWA on the basis of the foregoing criteria. Such offer shall disclose the valueand condition of the property. The best bid shall be accepted by TWA offering such surplusproperty. The cost of transferring the property shall be paid by the governmental unit or theprivate nonprofit agency purchasing or receiving the donation of the surplus property.15.2 ResponsibilityIt is the Purchasing and Warehouse Department’s responsibility to act in all matters pertaining tothe transfer and disposal of excess and surplus property under the direction and guidance of theBoard. The authorization for disposal of surplus property shall be recorded in the minutes of theBoard as required by Chapter 274, Florida Statutes.15.3 Classification of Surplus PropertyItems identified as surplus may be classified as follows:A. Excess – items without a useful purpose for a particular department, but may betransferred to another department.B. Surplus – material that has no use to the Authority.C. Scrap – items, which have value for material, content only (scrap metal,aluminum).D. Junked – items for destruction/abandonment that are useable and have very little,if any, commercial value (broken furniture/equipment).49|Page

E. Cannibalized – items removed for use as serviceable parts for repairing otherequipment. A written detailed explanation and Board approval is required beforeitems will be removed from effected account.15.4 Methods of DisposalTransfer: the preferred method of disposition for a useful item no longer needed by a departmentis to transfer it to another department that needs it. The Purchasing and Warehouse Departmentwill prepare and circulate a list of items available for transfer and shall require the ExecutiveDirector’s approval.Public Auction: this auction method is the standard disposition method used by the Authority forvehicles ONLY. It is handled by a third party vendor through the City of Kissimmee PurchasingDepartment. The auctions are publicly advertised and supplemented by the mailing notices toregular bidders.Sealed Bid: property that cannot be transported to the Warehouse or which has failed to sell onthe online auction site or property which is otherwise inappropriate for online auction sale maybe sold through sealed bids on an individual item or lot basis. The IFB should be issued to allpersons or firms on the bidder’s mailing list.Online Auction: this auction method is the standard disposition method used by the Authority forall items excluding vehicles. It is handled by a third party vendor.Trade-In: in replacing obsolete equipment, it may be advantageous to trade it in. Trade-in itemsare not required to be declared surplus. Obsolete, worn out, inactive, or uneconomical operatingequipment may be traded in on the purchase of new equipment.If a determination has been made to trade-in a particular piece of equipment, the IFB for thereplacement item should request bid prices with and without the trade-in and should allow for anaward to be made either way. Each department while completing the online purchase requisitionfor new items shall be required to identify the equipment being traded in. The identificationshould include the type of item, model of item, property control asset number, and serial numberof item. The PO should show the price of the new equipment less the trade-in allowance.Destruction: property which is unusable and determined to have no commercial value or propertyfor which the cost of sale would exceed expected returns may be destroyed or abandoned.Adequate documentation should be obtained and filed with the appropriate department.15.5 ProceduresEach department under the jurisdiction and control of the Authority which has property and/orcommodities that become surplus or obsolete will report it to the Purchasing and WarehouseDepartment for proper disposition. If the department has vehicles ONLY, it shall be reported to50|Page

the City of Kissimmee’s Purchasing Department. Departments will submit a completed PropertyDisposition Notice Form to the City of Kissimmee Maintenance Department and the Purchasingand Warehouse Department on the day of pickup. Once pickup is made, the City of KissimmeeMaintenance Department will inspect all items submitted to verify serviceability and condition.Vehicles and Heavy Equipment: these items will be evaluated by means of a limited technicalinspection performed by the City of Kissimmee Fleet Operations Department and the resultsforwarded to the City of Kissimmee, the Purchasing and Warehouse Department and theAccounting and Finance Department for proper coordination and disposition. All surplusvehicles and heavy equipment will be held in a central storage area for auction to a third partyvendor upon Board approval.Computer Equipment: all computer equipment, software, and accessories will be turned in to theInformation Technology Department for removal of any necessary software and check forcondition.Recommendations will be presented to the Board of Supervisors for final approval. Boardapproval of items which are accounted for shall constitute authorization to either transfer ordelete the item from accountability. Surplus and obsolete tangible personal property may bedisposed of only by procedures set forth in Sections 274.05 and 274.06, Florida Statutes and asotherwise authorized by law.15.6 Sale of MaterialsIf surplus property is not transferred to a governmental unit under Sections 274.05 and 274.06,Florida Statutes then the following are options:A. The Purchasing and Warehouse Manager shall place a notice in a local newspaperof general circulation within Osceola County not less than seven (7) calendar dayspreceding the sale. Notices shall include a general description of item, the dateand time of the auction or sealed bid due date and where items may be obtained.B. Auctions shall be contracted out by the Purchasing and Warehouse Department.C. Item(s) shall normally be sold to the highest bidder, whether by public auction,online auction, or sealed bid.D. All sales by public and online auction shall be final at time of sale. Sealed bidsales are final upon acceptance by the Board of Supervisors.E. To avoid the perception of impropriety, Authority employees and elected officialsare barred from directly purchasing Authority surplus.15.7 Items Approved for Cannibalization51|Page

When an item(s) is cannibalized (parts removed for other uses), a written detailed explanationwill be required, as well as Board approval before that item(s) will be removed from the effectedaccount.15.8 Donation of Miscellaneous Surplus PropertyIt is the objective to minimize the inventory of miscellaneous surplus property and associatedcosts to the Authority. Any item that is classified as surplus because it is obsolete or itscontinued use is uneconomical or inefficient and which is no longer useful by the Authority maybe disposed of under this Section:A. Custodians may dispose of property certified as surplus by:1. Selling or transferring the property to any other governmental entity;2. Selling or donating the property to any private nonprofit agencywhich is on the list of approved donees. Individuals or entities mayregister with TWA and be placed on the list of prospective donees.The TWA Executive Director shall establish such list. The list willconsist of all eligible non-profit agencies within the service area ofTWA and may include religious organizations but will not includereligious organizations unless their principal mission comports withthe definition of private non-profit agency. The surplus property willbe offered to private non-profit Agencies in a non-discriminatorymanner, on a first come, first serve basis, based upon the date ofregistration of such agencies with TWA as prospective donees andwill be administered so that no prospective donee is favored;3. Selling the property through a sale open to the public; or4. Entering into contractual agreements with other entities, including,but not limited to, other governmental agencies or private vendors,which facilitate the final disposition of the property. Such agreementsmay include, but are not limited to, the leasing of storage space orarrangements for the disposal of scrap property.B. A Private non-profit agency must meet the following definition:“Private nonprofit agency” means a nonprofit charitable organization, no part ofthe net earnings of which inures or may lawfully inure to the benefit of anyprivate shareholder or individual, which has been held to be tax-exempt under theprovisions of s. 501 of the Internal Revenue Code of 1954, and which has as itsprincipal mission:1. Public health and welfare;2. Education;52|Page

3. Environmental restoration and conservation;4. Civil and human rights; or5. The relief of human suffering and poverty.Miscellaneous surplus definition: obsolete items, such as furniture (chairs, tables, desks, filecabinets, typewriters, computer hardware, copiers, etc.). It is the intent that only these types ofitems shall be donated. Rolling stock, vehicles, etc. shall not be disposed of under this section.Occasionally, it may be practical to donate rather than sell an item(s) to a non-profitorganization. The Board of Supervisors shall have the authority to approve donations ofmiscellaneous surplus property to such organizations on a "first come, first serve" basis when ithas been determined that to do so is in the best interest of the Authority. The time limit for anorganization to receive miscellaneous surplus property is unlimited. The organization is requiredto submit an application providing the appropriate information in order to be considered fordonation.15.9 Collection and Sale of Scrap MetalsMetals which have lost all value in their original form will be deposited in locations designatedby the Purchasing and Warehouse Manager for the purpose of sale, unless otherwise directed bythe Executive Director or Board of Supervisors.An IFB on scrap materials will be advertised in a local newspaper in accordance with formal bidprocedures set forth in Section 7 and shall list the various types of metals for sale. Proceedsfrom the sale of scrap will be returned as revenue to the general fund, unless otherwise specifiedby the Executive Director or Board of Supervisors.53|Page

SECTION 16.PURCHASING CARD PROGRAM16.1 IntroductionThe Authority’s Purchasing Card Program is designed to improve efficiency in processing lowdollar purchases from any vendor that accepts the Visa credit card. This Purchasing CardProgram is applicable only to those purchases where a single purchase transaction is less than$1,000.This program will allow the cardholder to purchase approved commodities directly fromvendors. Each Purchasing Card is issued to a named individual and Toho Water Authority isclearly shown on the card as the governmental buyer of goods.The Finance Department will monitor the performance of the program. All questions orconcerns should be directed to:A. Purchasing CardAdministrator:Comptroller (407) 944-5137B. Procurementrelated:Purchasing and WarehouseManager(407) 944-5181C. Accounts Payablerelated:Accountant (407) 944-514016.2 PurposeTo establish procedures under which departments will control the use of Purchasing Cardsassigned to and utilized by Authority employees for purchasing goods and services on behalf ofthe Authority. The purpose of these policies and procedures is to accomplish the following:A. To provide an efficient method of purchasing and paying for goods not exceeding$1,000 per purchase.B. To expedite the purchasing process for departments requiring small dollarpurchases.C. To ensure Purchasing Card purchases are in accordance with the Authority’sordinances, policies, and procedures.D. To enhance productivity, significantly improve controls, and reduce bothpaperwork and the overall cost associated with small purchases.54|Page

E. To ensure that the Authority bears no legal liability from inappropriate use ofPurchasing Cards.F. To provide for disciplinary action if the Purchasing Cards are misused.The primary advantages of the Purchasing Card Program are the various limitations andrestrictions the Authority can establish. These features allow the Authority to tailor the programto fit its needs and to extend purchasing responsibility to many more individuals than in thecurrent purchasing environment, while maintaining or even increasing accountability.The success of the Authority’s Purchasing Card Program relies on the cooperation andprofessionalism of all personnel associated with this initiative. The most important participant isthe cardholder. Cardholders are the key element in making this program successful.The policies and procedures provided herein are minimum standards for departments.Departments may establish additional controls if necessary.16.3 How It WorksThe Purchasing Card Program is intended to simplify the procurement/disbursement process.Procurement responsibility is delegated to the ordering department enabling an authorizedcardholder to place an order directly with the vendor.When a purchase authorization is requested by the supplier, at the point-of-sale, the VisaPurchasing Card Program validates the transaction against the preset monthly spending limitestablished by the employee’s Department Director for each cardholder, as well as the $1,000limitation per transaction. All transactions are approved or declined (electronically) based on thePurchasing Card authorization criteria established. The authorization criteria may be adjustedperiodically as needed and may include, but is not limited to, the following:A. Single purchase limit (not to exceed $1,000)B. Monthly spending limitC. Approved Merchant Category CodesThe authorization process occurs through the electronic system that supports the Purchasing Cardprocessing services under the Authority’s agreement with SunTrust Bank Card N.A.16.4 ResponsibilityThe following is a summation of the responsibilities of the individuals and organizationsinvolved in the Purchasing Card Program.55|Page

CardholderA. Attend a training class prior to receipt of the card that will be administered by thePurchasing and Warehouse Department.B. Complete the Purchasing Card Quiz.C. Sign back of card upon issuance.D. Hold and safeguard Purchasing Card (do not loan out card).E. Sign a Cardholder Agreement Form and turn into the Purchasing and WarehouseManager.F. Use card only for Authority business.G. Order materials.H. Remind vendors that the Authority is tax-exempt and no sales tax should becharged (Sales tax exemption number is imprinted on the face of each card).I. Collect, sign, and save sales receipts.J. Forward sales receipts to Department Representative.K. Provide a description of each Purchasing Card transaction to the DepartmentRepresentative if the sales receipt does not include a detailed description.L. Review the monthly statement of charges for validity of all transactions.M. Review monthly charges with supervisor.N. Report lost or stolen card to Department Director, Department Representative,and Purchasing Card Administrator. The cardholder must also call Visa at 1-800-VISA911 (1-800-847-2911).O. Identify, describe, and report disputed charges to Department Representative.Department RepresentativeThis individual(s) is designated by the Department Director and is different from the cardholder.The following responsibilities apply:56|Page

A. Review transactions with the cardholder once they have posted to the Purchasing Cardsoftware and verify appropriateness of G/L account numbers assigned to charges.B. Approve transactions in Purchasing Card software.C. When notified by cardholder, immediately complete a Purchasing Card DisputeForm (Appendix G) for any disputed item(s) and forward the form to thePurchasing Card Administrator.D. Receive monthly statements from SunTrust Bank.E. Match sales receipts to monthly bank statement.F. Forward bank statement and supporting sales receipts to Accounts Payable.Department DirectorA. Approve/disapprove all Purchasing Card requests.B. Forward approved requests with credit limits to Purchasing Card Administrator.C. Approve credit card transactions or designate Department Representative forauthorizing charges and approving monthly statements. Please note: a cardholdermay not approve his/her own transactions.D. Collect cards from cardholders who terminate their employment.E. Notify P-Card Administrator to cancel or edit the profile of cards when employeestransfer to another Department/Division within the Authority.F. Notify the Purchasing Card Administrator of terminated employees.Purchasing and Warehouse ManagerA. Distribute cards to cardholders.B. Administer test on Purchasing Card policies and procedures to new cardholders.C. Determine final resolution of supplier disputes.D. Evaluate Purchasing Card feedback from suppliers.E. Participate in ongoing Purchasing Card programs.57|Page

Purchasing Card AdministratorA. Coordinate program policy issues.B. Input new cardholders and their default account numbers into the Purchasing cardsoftware.C. Cancel cards as necessary.D. Participate in resolving billing disputes.E. Notify Accounts Payable of disputed transactions.F. Export transactions to financial software monthly for payment.Accounts PayableA. Receive statements from departments including attached receipts, appropriateaccount code to be charged, a notation of any disputed items, and a propersignature authorization by the Department Director or authorized DepartmentRepresentative.B. Notify departments when statements (including supporting documentation) arenot received when due.C. Give final approval for transactions in the Purchasing Card software for theprocessing of payment.D. Notify department when account numbers are changed.E. Check all approved monthly charges against a consolidated bank statement.F. Process accounting data into the accounting system.G. Reconcile posted transactions to paid statements.H. File/Image statements, receipts etc., for audit purposes.I. Coordinate and maintain internal accounting controls over the Purchasing CardProgram.16.5 Assignment and Control of the Purchasing CardRequests for and Issuance of Purchasing Cards58|Page

A. Purchasing cards will be issued to individual employees who frequently purchasegoods. Generally, these will be the employees who, before the Purchasing CardProgram, often used Petty Purchase Orders for small dollar purchases.B. The Purchasing Card will have the employee’s name, the Authority’s name, thesales tax ID number, and the expiration date embossed on the face of the card.The Purchasing Card issuing company will not have individual cardholderinformation other than the cardholder’s work address. No credit records, socialsecurity numbers etc. of the cardholder are maintained.C. All requests for Purchasing Cards must be made by the Department Director. Anemployee that is in the probationary period of employment shall not be issued acard.D. All requests for new cardholders or for changes to current cardholders will bemade by submitting an email to the Purchasing Card Administrator.E. When the Purchasing and Warehouse Manager receives a Purchasing Card fromthe issuing card company, the cardholder will be required to personally sign aCardholder Agreement Form. A training class will be scheduled for thecardholder and Departmental Representative or other authorized individual.Persons attending the training class will be emailed a copy of the PurchasingPolicy to review the Purchase Card Program. All cardholders shall be required toattend this training class prior to receiving their card. Purchasing Cards will bedistributed to each cardholder upon completion of training, passing of PurchasingCard Quiz, and completed Cardholder Agreement.F. Upon receipt of new or replacement cards from VISA, the Purchasing andWarehouse Manager will notify the cardholder for distribution.16.6 Purchasing Card SecurityLost or Stolen Purchasing CardA. If a Purchasing Card is lost or stolen, the cardholder must immediately notify theDepartment Director, Departmental Representative, Purchasing CardAdministrator, and VISA (800-VISA911 or 800-847-2911). If the card is lostafter normal business hours (Monday through Friday – 8 A.M. to 5 P.M.) thecardholder must still notify VISA immediately, but will notify the DepartmentDirector, Departmental Representative, and the Purchasing Card Administrator onthe next business day. Cardholders may be held personally liable if the lost cardis not reported promptly.59|Page

B. The cardholder will be responsible for reporting all information necessary toreduce the liability to the Authority for a lost or stolen card.C. The Purchasing Card Administrator will notify Accounts Payable of the lost orstolen card.Terminations or Transfer of CardholderA. When an employee ends his or her employment, the Department Director mustcollect the Purchasing Card and destroy it by cutting it down the magnetic strip.The department must then submit the destroyed card to the Purchasing CardAdministrator.B. If the department is unable to collect the Purchasing Card when an employeeterminates, the Department Director must immediately notify the Purchasing CardAdministrator. The Purchasing Card Administrator will ensure that the card iscanceled.C. The Department Director must notify the Purchasing Card Administrator when anemployee transfers departments.Authorized Use of the Purchasing CardA. Cardholder Use Only: Only the employee whose name is embossed on the cardmay use the Purchasing Card. No other person is authorized to use the card.Improper or unauthorized use of the card may result in dismissal of the employee.B. The Authority Purchases Only: The Purchasing Card is to be used for Authorityauthorized purchases only. Any personal use of the Purchasing Card is strictlyprohibited. Any personal expenditure made on the card will requireimmediate reimbursement to the Authority. Abuse of Purchasing Card policiesand procedures could result in disciplinary action, which may includedismissal.Dollar LimitationsA. The Department Director will set a 30-day spending limit for each cardholder.The maximum limit shall be established based upon each individual’s need.Requests for spending limit changes must be initiated and authorized by theDepartment Director and coordinated with the Purchasing Card Administrator.B. A purchase may be made of multiple items, but the invoice cannot exceed $1,000.Charges for purchases shall not be split into multiple transactions to staywithin the single purchase limit of $1,000.60|Page

Over the Counter/Internet PurchasesAll items purchased over-the-counter or by Internet must be immediately available. If items areback-ordered, the Authority may not be charged except upon delivery of the merchandise. Inaddition, back-ordered merchandise must be received within the same 30-day billing cycle thatthe charge was made. The order should not be placed without this assurance.Food PurchasesPurchases of food are authorized using the Purchasing Card as follows:A. Food provided for elected officials and the Authority staff at official meetingsscheduled during generally accepted meal timesB. Meals that are part of the employee recognition awardsC. Food purchases during a declared emergencyD. Food purchased while attending conferences and/or approved training sessionsoutside the Authority Service Area, in conformity with the Training and TravelPolicy.Prohibited Use of the Purchasing CardThe following types of items may not be purchased with a Purchasing Card no matter the dollaramount.A. Gas, fuel, or oil (unless using an Authority vehicle while out of town on Authoritybusiness within a five (5) mile radius from the nearest service station or if aspecial type of fuel is needed that is not sold by City of Kissimmee FleetManagement)B. Vehicle repairs (unless Authority vehicle and prior approval is obtained from theDepartment Head)C. Cash advancesD. Utilities (i.e. telephone services, telephone calls)E. Items available through state contract or other price agreement contractF. Alcoholic beverages and tobacco productsG. Rental or lease of land or buildings61|Page

H. Recurring maintenance, rental or lease of equipmentI. Entertainment expensesJ. Any purchases where insurance requirements are a consideration and cardholderhas not obtained the approval of the Risk Management DepartmentK. Fixed assets over $1,000L. Professional Services (i.e., architectural, engineering, land surveying, legal,accounting)M. Personal Services (i.e., personal mail service, individual employee benefit)Permitted Travel for Employees with Designated Travel Allowance on their Purchasing CardThe following purchases are permitted with the Purchasing Card ONLY for authorized travelexpenditures within the travel expense reimbursement policy adopted by the Authority Boardand in conformity with state law:A. Travel related expenditures (hotels, seminars, workshops, conferences, car rental,etc.)B. Entertainment expenses for Authority useC. Utilities (i.e. telephone services, telephone calls)D. Rental or lease of land or buildingsE. Recurring maintenance, rental or lease of equipmentReview of Purchases by DepartmentsBecause of their knowledge of the job responsibilities and requirements, DepartmentRepresentatives are required to review each Purchasing Card expenditure (item purchased,amount, and vendor) to ensure the goods purchased was necessary, and for official use.When purchases are questioned, the Department Director or their designated DepartmentRepresentative will be responsible for resolving the issue with the cardholder. If the DepartmentDirector cannot be satisfied that the purchase was necessary and for official use, the cardholdermust provide either a credit voucher proving the item(s) were returned for credit or a personalcheck for the full amount of the purchase. Checks must be sent to the Accounting and FinanceDepartment with an explanation and account number.62|Page

Serious or repeated misuse of the Purchasing Card will result in the revocation of the card. TheDepartment/Division Director as necessary will discipline employees abusing their PurchasingCard privileges. Depending on the nature and recurrence of card abuse, disciplinary action mayinclude dismissal of the employee.To help the departments in their reviews, management reports will be available from thePurchasing Card Company or the Accounting and Finance Department.16.7 Procedures for Making and Paying for PurchasesDocumentation for Over-the-Counter PurchasesA. When an over-the-counter purchase is made, the cardholder must obtain thecustomer’s copy of the sales receipt.B. The vendor must be informed that the Authority is exempt from sales tax. Thesales tax exempt number will appear on the face of the card.C. The sales receipt will be forwarded to the Department Representative forreconciliation to the monthly bank statement.Telephone OrdersWhen placing a telephone order, the cardholder must confirm that the vendor will charge thePurchasing Card when shipment is made so that receipt of the commodities may be certified onthe monthly Statement of Account. The customer copy of the charge slip must be mailed orpicked up by the cardholder.Internet PurchasesA. Only secured websites authorized for use by the Authority are allowable formaking Internet purchases.B. When placing an order through the Internet, the cardholder must confirm that thevendor will charge the Purchasing Card only when shipment is made, so thatreceipt of the merchandise may be certified on the monthly statement from VISA.If items are back-ordered, the Authority may not be charged until delivery of themerchandise occurs. In addition, cardholders must obtain delivery of backorderedmerchandise within the same 30-day billing cycle that the charge wasmade. This ensures that payment is not made prior to delivery of the merchandise.C. Cardholder must print a copy of the online sales receipt/documentation at the timeof the online purchase to give to the Department Representative.63|Page

Missing DocumentationIf for some reason the cardholder does not have a sales receipt or documentation of thetransaction to give to the Department Representative, he/she must submit a Purchasing CardReceipt Form. Continued incidents of missing documentation may result in the cancellationof the employee’s Purchasing Card. Every effort must be made to retain original copies ofreceipts that are received at the time of purchase.Payment and Invoice ProceduresA. Department Representatives will receive periodic transactions and willimmediately update the Purchasing Card software. This application will beavailable via the Internet. This application will list all unapproved transactions,produce a report of approved transactions and post the transactions to theaccounting system. The Department will also receive a statement of accountdirectly from VISA.B. The cardholder and Department Representative must review and reconcile themonthly bank statement and note any errors or disputes. The DepartmentRepresentative must accept each transaction and Department Director or assigneddesignee must approve each transaction. The Department Representative willprovide a brief description of what was purchased and charge the accountnumbers for each item (if necessary). After approving transactions, thedepartment will print and forward a hard copy of the report to Finance (AccountsPayable). The printed report must include all required information, must be signedby the Department Director or Representative, and must have all card salesreceipts attached for each transaction. If a receipt is lost or missing, a PurchasingCard Receipt Form must be attached in lieu of an actual receipt. By signing thestatement, the designated Department Representative is certifying that all chargesare appropriate and authorized and that attached receipts prove all charges.C. Once new transactions are posted to the Purchase Card Transactions system,departments will have five (5) days to accept and approve the transactions andchange the default account numbers if necessary.16.8 DisputesA. If items purchased with the Purchasing Card are defective, the cardholder mustreturn the item(s) to the vendor for replacement or credit. If the vendor refuses toreplace or correct the faulty item, the purchase will be considered in dispute.B. Sales tax charged will not be disputed unless the vendor refuses to grant credit.64|Page

ProceduresC. A disputed item must be explained by completing the Purchasing Card DisputeForm immediately when the dispute arises.D. It is essential that the time frames and documentation requirements established bythis policy manual are being followed to protect the cardholder’s rights in dispute.All disputed items will be brought to the attention of, and handled by, thePurchasing Card Administrator.A dispute occurs when a cardholder questions a transaction that has been charged to his/heraccount. The following steps must be taken to ensure prompt settlement:A. The cardholder contacts the merchant about the transaction and supplies thenecessary information to begin the resolution process, AND;B. The cardholder completes the Purchasing Card Dispute Form and forwards it toPurchasing Card Administrator. Purchasing Card Administrator will then notifyAccounts Payable. Purchasing Card Administrator will contact the bank and thebank will place the transaction into a disputed status. Authority departmentsshould not contact SunTrust Bank directly. When the department receives themonthly bank statement, any disputed item on the statement must be noted.C. If the problem is resolved between the merchant and the cardholder, Finance willwrite the solution agreed upon on the bottom of the Dispute Form that waspreviously submitted.No Agreement is MadeIf an agreement cannot be reached, the following steps will be completed:A. After the item has been entered as a dispute, SunTrust Bank must determine whois responsible by researching the transaction including requesting a copy of thesales draft when necessary. When responsibility for the transaction is determined,the dispute will be settled on-line.B. When an account is in a dispute status, the disputed amount is still included incalculating the available money for authorizations (monthly limit). At the timethe item is placed in dispute, it is removed from all finance charge, late charge,over limit fee, and past due amount calculations. Finance charges that accruefrom posting until the item is placed in dispute must be handled according toAuthority policy. Any monthly bank statements generated while the account is indispute will display the following message:65|Page

YOUR ACCOUNT IS IN DISPUTE FOR $XXX.XX. THIS AMOUNT HAS NOT BEENINCLUDED IN THE FINANCE CHARGE OR PAYMENT CALCULATIONS.C. If the cardholder is actually responsible for the transaction, the dispute is settled infavor of SunTrust Bank and no further actions are required. If the cardholder isnot responsible for the transaction, the dispute is settled for the cardholder and thecharge back process may be initiated against the merchant.D. If there continue to be problems with a particular merchant, the cardholder shouldnotify the Purchasing Card Administrator and Purchasing and WarehouseManager.16.9 Procurement of Travel and Related ExpendituresWhen conducting any type of travel and related expenditures (i.e., hotel, conferenceregistrations, hotel parking, etc.) Authority employees shall sign out a travel Purchasing Cardfrom the Accounting and Finance Department. The travel Purchasing Card shall not be used forpersonal travel under any circumstance. Any employee in violation of this policy shall beresponsible for reimbursing the Authority, cancellation of the Purchasing Card, and subject todisciplinary action.The following additional procedures should be followed when using the travel Purchasing Card:A. Prior to travel a completed Travel and Training 1 Form (TT1) must be submittedto the Accounting and Finance Department with the appropriate signatures assoon as travel arrangements are anticipated. Backup documentation must includethe estimate of travel costs. Conference brochures, itineraries, or other referencematerial must also be included to document the cost of travel expenses that will bepaid in advance with the travel Purchasing Card.B. Upon completion of travel a completed Travel and Training 2 Form (TT2) mustbe approved and submitted with the original receipts to the Accounting andFinance Department.Items that can typically be procured with the travel Purchasing Card are:A. Lodging – only a single rate should be charged. If the hotel will not accept a Tax-Exempt Certificate, then the applicable tax may also be charged to the card.B. Rental cars – most economical type of vehicle.C. Conference/workshop/seminar/registration.D. Business telephone calls.66|Page

Items that are typically prohibited are:A. Meals – except for designated departmental personnelB. In-room moviesC. Gasoline (unless authorized)All travel shall be in compliance with this section. Prior approval must be obtained to utilize thetravel Purchasing Card for reservation(s) of travel expenses. The Purchasing Card Administratorhas the authority to cancel any cardholder’s Purchasing Card immediately upon verification ofmisuse. There are no exceptions to the application of this section to any employee, unlessotherwise approved.67|Page

SECTION 17. CONTRACTS17.1 PurposeThe purpose of this section is to provide procedures for the proper review and approval ofcontracts entered into by the Board of Supervisors. Contract administration begins when it isdetermined that a contract is either desirable or necessary. Various aspects of contractadministration include negotiation between the parties, preparation of contracts and other writtendocuments, review and comment by various departments and public officials, proper approvaland execution of contracts, distribution and filing of contracts, and implementation andmonitoring of contracts.The contract process is assigned to provide understanding of how contracts are managed toensure that contracts administered by the Authority are both legal and in the best interest of theAuthority. Good contract administration also minimizes duplicity of effort and provides for theproper coordination and participation of those who are necessarily involved in the contractprocess.A contract represents a legal obligation on the part of each party to the contract, which resultsfrom the parties’ agreement, plus some additional obligations imposed by law. The mutualpromises exchanged by the parties to a contract represent the consideration, which entitles eachparty to rely on the promise of the other. Various legal requirements must be satisfied in order tocreate a legally binding contract. The parties to an agreement must have the legal capacity toenter into a contract. There must be mutual consent to the terms of the contract. Certain formalrequisites to a contract are also necessary, such as proper signing of the agreement, which iscalled execution of the contract.Contracts which violate constitutional or statutory provision, or are deemed by law to be againstpublic policy, or which are otherwise illegal can have serious ramifications on one or moreparties to the purported contract.It is required that contracts be awarded only upon the completion of a competitive bid orproposal.17.2 Contract Development, Approval, and ExecutionContract DevelopmentSubsequent to the receipt of bids, proposals and quotes and prior to approval of therecommended vendor, a written contract shall be prepared if the purchase is expected to exceed$50,000 and shall be in accordance with the following procedures:A. Draft contract shall be prepared by the Purchasing and Warehouse Department inconjunction with the User Department and General Counsel. Not all service68|Page

contracts require a written contract. Most service contracts can be finalized withissuance of a PO.B. Draft contract should include, but not limited to the:basic type of period of services to be provided,method of payment schedule,termination clause,change order statement,time schedule of project,remedies,right of audit,governing law,successors and assignees,insurance statement and copy of certificate of insurance,performance bond, or other applicable bonds,entire agreement statement,signature authority,an acceptable level of legal and liability protection,a scope of work statement according to various phases, if any, time restrictionof each phase and addendum, etc., that materially represent the provisionscalled for during the IFB/RFP selection process.Contract ApprovalAll contracts that are expected to go above $50,000 shall be prepared by the Purchasing andWarehouse Department and the User Department and reviewed by General Counsel or preparedby General Counsel prior to being submitted to the Board of Supervisors for approval.Contract Execution69|Page

Upon obtaining approval of the contract by the appropriate authority, the execution of thecontract shall adhere to the following:A. The Purchasing and Warehouse Manager shall forward at least three (3) originalcopies of the formal contract signed by the vendor and including all relevantattachments to the Clerk of the Board of Supervisors whose responsibility shall beto ensure proper execution.The Purchasing and Warehouse Manager should ensure that the vendors adhere to the proceduresfor proper execution of contract documents:A. The vendor must sign the document before the Authority. The signor must beprepared to provide proof of his or her authority to bind the vendor.B. The vendor’s signature must be attested by one other person, preferably an officerof the corporation or if the vendor uses a corporate seal, it must be affixed thenone signature and corporate seal will suffice.Upon receipt of the executed contract, one copy shall be forwarded to the vendor, Accountingand Finance Division, and the Purchasing and Warehouse Department for the bid or proposalfile. The User Department shall be responsible for issuing the written Notice to Proceed in themanner described in the contract. In no instance shall work begin without issuance of the writtenNotice to Proceed.17.3 Contract Monitoring/AdministrationUser DepartmentThe User Department will:A. Determine the expected quality or performance level requiredB. Establish schedules for the duration and completion of contractsC. Assign a Project Manager or contract personD. Monitor performanceE. Document contract performance deficiencies (utilizing the Vendor PerformanceEvaluation Form, Appendix F)F. Prepare closeout and other final payment reportsG. Maintain proper insurance70|Page

Purchasing and Warehouse DepartmentThe Purchasing and Warehouse Department will assist the User Department in the monitoringand administration of contracts. The Purchasing and Warehouse Department will assist the UserDepartment to:A. Require from the contractor full conformance to specificationsB. Ensure the correct legal name is contained in the contract documents and furtherconfirm status of legal entityC. Working with the User Department, obtain appropriate price reductions when lessthan full contract performance is acceptableD. Hold contractor responsible for damages suffered by the Authority resulting fromthe contractor’s failure to perform as agreedE. Working with the User Department make certain that the Authority does not failto perform its obligations, thereby relieving the contractor of performanceresponsibilitiesF. Preclude the issuance of unnecessary or excessively priced change ordersG. Maintain standard clauses for contractual terms and conditions, which promotethe best interest of the AuthorityH. Initiating "cure" process to ensure vendor cures contract deficiencies within areasonable period of timeI. Maintain records of the following information:1. Contract or PO number2. Brief description of work, names and telephone numbers of project3. The status of each contractJ. Maintain records of vendor performanceK. Conduct a review of the vendor’s performance upon User Department’s requestL. Proper payment of invoices on time and at contract price17.4 Contract Change Order (Appendix G)71|Page

Justification of Change OrderThe need for a change is typically associated with a change in scope of work, scheduling, fieldconditions, errors in plans, undetected site conditions, adjustments or materials to be used.Change Order Approval ProcessOnce it has been determined a change order is required, the Purchasing and Warehouse Managershall process the request for the change order approval. All change orders shall be reviewed bythe Department Director prior to being submitted to the Board for approval.17.5 Certificates of InsuranceThe Purchasing and Warehouse Manager shall ensure that the vendor maintains the properinsurance requirements with the use of a Certificate of Insurance, which they will retain andmonitor. Each Certificate of Insurance shall have the necessary language that name theAuthority as an Additional Named Insured.72|Page

SECTION 18. PUBLIC NOTICES18.1 PurposePublic notice means the required notification or advertisement of an IFB, RFP or othercompetitive solicitation to be given to prospective vendors for a reasonable period of time asdetermined by the Purchasing and Warehouse Manager.Purchases below $100,000 at a minimum include:A. Mailing public notice to prospective vendors on an applicable bidders listmaintained by the Purchasing and Warehouse DepartmentB. Posting public notice on Demand Star by OnviaC. Posting public notice on the Authority’s websiteD. Advertising for a minimum of ten (10) calendar days prior to the bid openingPurchases $100,000 - $500,000 include:A. Advertisement of the public notice will be in the newspaper of general circulationand Demand Star by OnviaB. The public notice shall describe the goods or services sought and state the date,time and place of the bid/proposal/solicitation opening.C. Shall be advertised for a minimum of twenty-one (21) calendar days prior to thebid opening.Purchases $500,000 and over include:A. Advertisement of the public notice will be in the newspaper of general circulationand Demand Star by OnviaB. Shall be advertised for a minimum of thirty (30) calendar days prior to the bidopening.73|Page

19.1 Purchasing RecordsSECTION 19. RECORDS RETENTIONAll records shall be maintained for the period of this required by law and may be disposed ofonly in compliance with State authorized disposal procedures. The Administrative Assistant tothe Executive Director or the successor as Public Records Liason Officer or General Counselshould be consulted before any record is disposed of. No record may be disposed of after apublic records request is made for it or if it is of possible use in litigation without approval ofGeneral Counsel. The following records shall be maintained by Purchasing and shall at aminimum, be maintained for the period of time required by law:PO FilePOs shall be filed numerically. The current year and previous year are kept in the Purchasing andWarehouse Department office at all times. Two (2) additional years of POs will be archivedeither in the Purchasing File Area or Toho Water Authority’s archive records. POs will beretained for a period of three (3) fiscal years or such other the period as may be required by law.Bid and Proposal FileAll current year sealed bids and proposals received shall be maintained in a file location in thePurchasing and Warehouse Department office. Prior year bid files will be archived either in thePurchasing and Warehouse Department file area or the Authority’s archive records. Bid fileswill be retained for a period of five (5) fiscal years or such other period as may be required bylaw except Capital Improvement Bids. For Capital Improvement bids only, bid tabulations areretained for 25 years or such other period as may be required by law; successful bids shall bemaintained for 15 years and unsuccessful bids five (5) years or such other period as may berequired by law. Departments, other than the Purchasing and Warehouse Department, areresponsible for maintaining the bid files for bids administered by their department.Bid SpecificationsCopies of bid specifications will be maintained computer data files with a hard copy in the BidFile.Computer Data FilesData files will be backed up as required and copies maintained outside the Purchasing andWarehouse Department office.74|Page

SECTION 20. WAREHOUSE PROCEDURES20.1 PurposeThis section will cover the essential tasks performed at the Authority’s Warehouse and Pipe Yardand are designed for the use of assigned personnel. It will provide guidance on organizing,controlling, issuing, receiving, ordering and storing of goods.20.2 ResponsibilitiesIt is the responsibility of the Purchasing and Warehouse Department personnel to ensure thefollowing:A. Ensure proper receipt and documentation of warehouse deliveries.B. Work as part of a team without close supervision.C. Assist in the safe and proper loading of warehouse deliveries.D. Observe and maintain safety rules and standards.E. Maintain and operate material handling equipment in a safe manner.F. Report any unsafe conditions to the Purchasing and Warehouse Manager andSafety Coordinator.G. Ability to operate heavy equipment, i.e. forklift, pallet jack.20.3 EquipmentA pallet jack or forklift may be used on daily basis for the safe unloading and loading of goodsand materials. The following should be checked prior to use of any equipment:A. Batteries are fully charged and filled to the proper water level.B. Tires on jacks and forklifts do not have trash, nails or rocks wedged or wrappedaround them. Clean off any debris from these areas so as to prolong the life of theequipment.C. Make sure jacks and forklifts have no trash piled up or stuffed in any of thecompartments. This is not only unsightly, but also can affect the performance ofthe machine with spills and areas covered up that need to be inspected daily.20.4 Issue Procedures75|Page

CustomersCustomers of the Authority’s Warehouse and Pipe Yard are any departments and divisionswithin the Authority authorized to use the services of the Warehouse and Pipe Yard by thePurchasing and Warehouse Manager.Stock RequisitionsAll customers must enter a Stock Requisition in Paramount in order to receive supplies. Nosupplies will be issued without a Stock Requisition. The Warehouse Clerk or PurchasingTechnician will check the Stock Requisition for completeness and accuracy. Missinginformation will be filled in by the customer prior to any further processing. If the informationcannot be provided, the Stock Requisition will be rejected.Approval AuthorityThe Information Technology Department must first be contacted to arrange for access to theappropriate menus. The Information Technology Department will also assign Stock RequisitionApproval to the Department Head or his/her authorized representative in the same manner as aPurchase Requisition.Issuing StockThe customer will have the option of waiting for their item or return at a later time to pick it up.The Warehouse Clerk or the Purchasing Technician will then attempt to fill the order by pullingstock from the designated location. The Warehouse Clerk or Purchasing Technician will verifythat the item number matches the description entered on the Stock Requisition. If it does not, theWarehouse Clerk or Purchasing Technician will contact the customer to reconcile anydifferences.The customer will be given the opportunity to verify the items and counts being issued tohim/her. He/she will then ask to print, sign and date an Inventory Issue Ticket that will be givento him/her for his/her records with a copy to remain in the Warehouse.The Warehouse Clerk or Purchasing Technician will assist in moving any pallets to the loadingdock for customers to load their vehicles. Items subsequently found by a customer to bedamaged will be returned to the Warehouse and a replacement will be issued.For non-stocked items, issuing procedures will follow the same order as specified herein, exceptthat the customer will be required to sign the items out in a log book.Items on Hold76|Page

Any Stock Requisition with items not available in stock will be placed on hold in Paramount bythe Purchasing and Warehouse Manager. The customer will be notified by email of the itemsthat are on hold.Releasing Items on HoldUpon receipt of new stock, the Purchasing and Warehouse Manager will process the stockrequisition in Paramount that was placed on hold. The Warehouse Clerk or PurchasingTechnician will pull the item and send it out to the Warehouse for issue. The customer will benotified by email or phone that their items are available for pickup.ReturnsWhen customers have ordered an item in error, it will be marked as "Return" and posted as suchin Microsoft Dynamics Great Plains. The item will be added back to stock and the customer willreceive credit from the Accounting and Finance Division. If a customer receives a wrong modelor color of an item, they are to contact the Purchasing and Warehouse Department and have theitem exchanged. No additional paperwork is required, unless the issue has already been postedto Microsoft Dynamics Great Plains, in which case a return for credit will be necessary, as wellas a new issue document.20.5 Receiving ProceduresDues-InThe Warehouse Clerk and Purchasing Technician will maintain a file, in numerical sequence ofall POs for supplies due-in. Upon arrival of any delivery truck, the delivery ticket will bechecked for a PO number and the corresponding file copy of the PO will be pulled. Thisdocument will be used to assist in receiving supplies and to help insure that what is beingdelivered is, in fact, what was ordered.Off-LoadingAll deliverymen are responsible for bringing their items to the loading dock or the back edge oftheir truck or trailer. Under no circumstances will a Warehouse Clerk or Purchasing Technicianenter a trailer with a forklift. They may, however, remove items from the trailer while on theground in the vicinity of the Warehouse. The deliveryman will be allowed the use of a palletjack to drag the items out of the vehicle. Drivers will be provided with wooden pallets forexchange when requested.ReceivingOnce all pallets or boxes have been off-loaded, the Warehouse Clerk or Purchasing Technicianwill conduct a physical inspection of all boxes for any obvious signs of damage. Any damage ordiscrepancy that is found will be noted on the delivery ticket. The Warehouse Clerk or77|Page

Purchasing Technician will also verify the count of items or boxes against the delivery ticket tobe sure everything is accounted for. After all counts have been reconciled, the Warehouse Clerkor Purchasing Technician will sign the delivery ticket and give the driver his copies. If the driverchooses not to wait, the Warehouse Clerk or Purchasing Technician will annotate the deliveryticket as "Received, Subject to Count" and sign it.InspectionThe pallets will then be moved to an interior aisle away from the entrance and kept separate fromother similar items already in stock. The Warehouse Clerk or Purchasing Technician willconduct a count of all items received and check for hidden damage. Any discrepancies foundwill be brought to the attention of the Purchasing and Warehouse Manager so that the vendormay be contacted as quickly as possible to correct the situation. The vendor will be given theopportunity to replace any damaged goods. Likewise, the vendor will also exchange any itemthat has been incorrectly shipped. The pick-up of any such item will be at the vendor’s expense.Verification/CountWhen all inspections have been made and counts verified against the PO, the Warehouse Clerkor Purchasing Technician will then input all the information into Microsoft Dynamics GreatPlains.DocumentationThe Warehouse Clerk or Purchasing Technician will pull the department copy of the PO andattach it to the delivery ticket. The on hand balance will not be correct until the items areverified and received in Microsoft Dynamics Great Plains. If it does not match, the WarehouseClerk or Purchasing Technician will be directed to perform another count. If this count is right,the Warehouse Clerk or Purchasing Technician will mark the PO appropriately. If it is not right,an attempt will be made to research the discrepancy and correct it. If it cannot be corrected, aninventory adjustment will be made and documented after review by the Purchasing andWarehouse Manager.ReviewThe paperwork will then be presented to the Purchasing and Warehouse Manager for approval.The Purchasing and Warehouse Manager may wish to inspect the goods listed or verify a countdiscrepancy. The Purchasing and Warehouse Manager will initial the PO once the review iscomplete. The paperwork will then be returned to the Warehouse Clerk or PurchasingTechnician for further processing. At this point, the Warehouse Clerk or Purchasing Technicianmay place the items in their proper location.Posting78|Page

The Warehouse Clerk or Purchasing Technician will use the "Receiving Transaction Entry"screen in Microsoft Dynamics Great Plains to enter the received quantity in stock. TheWarehouse Clerk or Purchasing Technician will take any discounts offered by the vendor intoaccount when entering the items’ unit price.General GoodsWhen unloading general goods, it is important;A. Rotate inventory on a "first in; first out" (FIFO) basis. Any items not bearingrotation coding instructions should be dated on receipt. All goods are to berotated by pack date and not by FIFO. If they do not have a pack date then FIFOshall be used.B. Each pallet will have a date of receipt, stock number, description, and quantitycount sticker attached before it is put away.Storage/Put AwayAfter the product has been received and the inventory posted, the put away/storage is importantfor the following reasons:InvoicingA. Proper stock rotationB. Accessibility for restock and inventoryC. Maintaining product integrityOnce an invoice has been received, it will be checked for accuracy and sent to the Finance andAccounting Division for payment. Discrepancies will be corrected by the Purchasing andWarehouse Department prior to payment.20.6 Replenishment ProceduresReorder ReportA Reorder Report is printed on a daily basis in Microsoft Dynamics Great Plains by thePurchasing Technician. This report is used in preparation of orders. If any item in a commoditygroup appears on the list, the Purchasing Technician will check the required minimum andmaximum levels of all items within that group prior to placing any orders.Basic Ordering79|Page

Once a commodity group has been checked, a method of ordering will be through the RFQprocess.20.7 Inventory ProceduresThe goal of every warehouse is to have 100% accurate inventory. However, this may not bepossible due to "shrinkage". Shrinkage is industry jargon for missing inventory, usually causedby loss, theft, shortage in receiving, over shipment, or simply misplacement in the warehouse.The goal of the Purchasing and Warehouse Department is to reduce shrinkage throughcontinuous improvement in the warehouse. Managing the shrinkage requires an inventorymaintenance plan. This plan will include cycle counting, the industry standard method forimproving inventory accuracy.Method of Accounting and ValuationThe Warehouse and Pipe Yard are valued using the weighted average price method, whichapproximates FIFO (First In/First Out). The Purchasing and Warehouse Department usesMicrosoft Dynamics Great Plains to maintain the perpetual inventory. The accounting recordsare adjusted at year end based on the annual physical inventory count.Annual InventoryThe warehouse is shut down for the annual year-end inventory. The inventory is taken by theWarehouse Clerk, Purchasing Technician and the Purchasing and Warehouse Manager.A. Count sheets: The Purchasing and Warehouse Manager will divide the totalinventory into two (2) equal groups. While the goal is to count a group eachweek, operational considerations may make this impractical. The Purchasing andWarehouse Manager will determine the next grouping due for count and willrequest count slips in location sequence from Microsoft Dynamics Great Plainsbased on the next count date indicated. The count slips will be given to theWarehouse Clerk and Purchasing Technician, taking care not to assign a group tothe same personnel who counted it the last time.B. Counting Method: The Purchasing and Warehouse Department has a systematicway of making and recording the count of inventory. This is done throughmultiple counts. Each cycle count will have a minimum of two counts. The firstcount identifies variances and the second counts the variance to ensure they aretruly variances. A different person will conduct each count.C. Verification: If the second count agrees with first count, the Warehouse Clerk andPurchasing Technician will place a check mark beside the items. If it does notmatch, the Warehouse Clerk and Purchasing Technician will make an effort to80|Page

check the transaction records for possible posting errors. If this resolves thediscrepancy, the item will be marked with a check mark. If it does not resolve theerror, the Warehouse Clerk and Purchasing Technician will then write in thequantity and the entire count sheet will be presented to the Purchasing andWarehouse Manager for review.D. Approval: The Purchasing and Warehouse Manager will then inventory theitem(s). If the count stands, the Purchasing and Warehouse Manager willannotate the count slip with a quantity and a plus (+) or minus (-) sign to indicatethe adjustment to be made. The Purchasing and Warehouse Manager will thensign and date the front of the count sheet approving the adjustments indicated andthen post the inventory results to Microsoft Dynamics Great Plains.E. Adjustment: If an adjustment is needed, an Exception Report will beautomatically generated indicating the counts that do not match. This informationwill be forwarded to the Accounting and Finance Department to adjust the dollarvalue of the total inventory.20.8 Storage ProceduresLocationsEach item in inventory shall have a permanently assigned location in the warehouse. Thislocation shall be noted on the Inventory Item List in Microsoft Dynamics Great Plains so that itis available for any system outputs such as bin tags and count sheets. Each location shall have asystem generated bin tag with basic item information on it. Those items requiring a secondlocation shall have a handmade label with item number and the second location indicated upon it.For issues of case lots and larger, the Warehouse Clerk or Purchasing Technician shall endeavorto issue from the second location first. In the event that the second location is empty, the labelshall be removed as a signal that nothing is in that location.TurnoverItems with high usage factors shall be stored as close as possible to the front entrance in order toreduce the time needed to pull stock for issuing. Whenever practicable, items with less activityshall be stored toward the back of the warehouse.RestockingDuring times of reduced activity, the Warehouse Clerk or Purchasing Technician shall check theprimary locations and refill them with stock from the secondary locations.Damaged Items81|Page

Items found to be damaged, expired or otherwise unfit for issue will be reported to thePurchasing and Warehouse Manager. After review, the item will be entered on a StockRequisition maintained for this purpose and dropped from inventory or be put in the auction.Holding AreaA portion of the front area of the warehouse is to be reserved for those items already pulled fromstock and awaiting pick-up by the customer. The Warehouse Clerk or Purchasing Technicianshall keep items separated by the Stock Requisition to which they pertain and avoid the cominglingof different customers’ items.Storage TypesThe following are different storage types:MaterialsA. Rack Type: When using the rack type storage, make sure the product is on theproper pallets for put away. If the pallet is not the correct size, notify thePurchasing and Warehouse Manager immediately. Putting a wrong size pallet upon the racks can cause damage to the product and also put other employees at riskof injury.B. Shelf Type: When using the shelf type storage, make sure the product is put usingthe FIFO basis. This will assure the proper rotation of stock. All commoditiesare to be rotated by pack date and not by FIFO.The following packing materials are used in the warehouse:ExcessA. Shrink Wrapping: It is mandatory when putting any product that is palletized upon a rack, to make sure that it is shrink wrapped securely for the safety ofproducts and employees.B. Pallets: As much as possible, the Warehouse Clerk or Purchasing Technician shalluse plastic pallets in the majority of locations in the warehouse. An exceptionwould be high turnover items.The Warehouse is the designated disposal point for excess property for the Authority.Customers will bring their excess items to the Warehouse so that the Purchasing and WarehouseManager can determine if the item is salvageable. If it is of further use, the item will be storedand made available to other divisions. If the item is excess to the needs of the Authority, it willbe held until the next scheduled auction, at which time it will be sold to the highest bidder.82|Page

20.9 SafetyIt is important each employee who enters and leaves the Warehouse and Pipe Yard, makes everyeffort to ensure that their work location is a safe place in which to work. Each employee must dohis/her part to protect him/her and fellow employees from injury. This is to be accomplishedthrough vigilance and safety consciousness and observance of surroundings at all times. Eachemployee can help to achieve even better safety by:A. Learning and obeying all safety rulesB. Keeping safety in mind at all timesC. Consulting leads or management when in doubtD. Reporting all injuries and accidents no matter how slight20.10 SecuritySecurity of all items is always a priority. The controlling and monitoring of the items is a must.The following steps are done daily:A. All doors should be locked and checked when shutting down and closing up.B. Note and inform any unexplained additions or withdrawals from stock orunexplained damage to facilities to the Purchasing and Warehouse Managerimmediately.C. Alarm hours are set by the Purchasing and Warehouse Department and theymonitor when personnel are not in the building. A list of contacts is providedwhen alarms sound.83|Page

21.1 Local Vendor PreferenceSECTION 21. PREFERENCESThe Local Vendor Preference will apply only to:A. Contracts equal to or less than $2,000,000.B. Equipment and commodity purchases equal to or less than $150,000.The Local Vendor Preference is applicable to any RFQ and/or formal bid solicitation by theAuthority that meets the price criteria above.The qualified local vendor who has submitted the lowest responsive and responsible bid from alllocal vendors who submit a bid in response to a solicitation and whose bid is within three percent(3%) of the lowest responsive and responsible bid will be provided the opportunity to match thelowest responsive and responsible bid from bid submittals within three (3) business days of thebid opening. If the local vendor agrees in writing to match the lowest responsive and responsiblebid, the purchase/contract will be awarded to the local vendor. If the local vendor does not agreeto match the lowest responsive and responsible bid, the purchase/contract will be awarded to thelowest responsive and responsible bidder.To qualify as a "local vendor" the following criteria must be met:A. Have had its headquarters, manufacturing facility, locally-owned franchise, or anoperating branch located in, or having a street address within the legal boundariesof Osceola County or the Authority service area in Polk County or Orange Countyfor at least one (1) year immediately prior to the issuance of the RFQ or formalbid solicitation. (Post office boxes do not qualify as a verifiable business address)andB. Maintained a valid or current business license by a jurisdiction located in Osceola,Polk or Orange County for at least one (1) year prior as outlined in (A) above.C. Pays business and/or real property tax due to Osceola, Polk or Orange County andhas paid such tax for the most recent tax year.A local vendor may become pre-qualified prior to submitting a bid or quotation by submittingthe following:A. A physical address.84|Page

B. A copy of a current Osceola County Local Business Tax Receipt (formerly knownas an occupational license) or other local jurisdiction located in Osceola Countyor, as applicable, in Polk or Orange County, to verify the business location.C. Proof of payment of business license and/or real property tax due to OsceolaCounty, or, as applicable, Polk or Orange County.Exceptions shall include, but are not limited to the following:A. Purchases that are funded in whole or in part by assistance from any federal, stateor local agency that disallows local preference.B. Purchases made through a cooperative agreement (i.e., one or more agenciescombining requirements in order to benefit from discounts that may be obtainedthrough volume purchasing).C. Purchases made from another agency’s agreements or contracts (i.e.piggybacking).D. Purchases subject to Section 287.055, Florida Statutes, the Consultants’Competitive Negotiation Act (CCNA), as amended.E. Procurements subject to formal proposal where price is not a primary factorand/or is not part of the criterion and; therefore, not subject to local vendorpreference; however, a firm’s location may be considered in the evaluationcriterion.F. Such other contractual services as may be exempted by policy of the Board.21.2 Drug-free Workplace PreferenceWhenever two (2) or more bids, which are equal with respect to price, quality, andservices, are received, a bid received from a business that certifies that it hasimplemented a drug-free workplace program shall be given preference in accordancewith Section 287.087, Florida Statutes.21.3 Preferences Mandated by State Law.All preferences mandated by state law will apply. See, for example: Section 287.084Florida Statutes (preference or purchases of personal property (note that Section287.084(2) requires that an opinion of an attorney licensed to practice law in that foreignState as to the preference, if any or none, granted by the Law of that State to its ownbusiness entities whose principal place of business are in that foreign State in the lettingof any or all public contacts accompany any written bid, proposal or reply document.) to85|Page

usinesses where lowest responsible bid, proposer or reply by a vendor whose principalplace of business is in a State or subdivision thereof with a local preference); Section287.092 Florida Statutes grants preference to foreign manufacturers with a factory in theState and employing over 200 employees working in the State, when price, quality andservice, regardless of where this product is manufactured.86|Page

SECTION 22. DEBARMENT OF BIDDERS22.1 PurposeThe Authority shall solicit offers from, award contracts to and consent to subcontracts withresponsible contractors only. To effectuate this policy the debarment of contractors fromAuthority work may be undertaken. The serious nature of debarment requires that this sanctionbe imposed only when it is in the public interest for the authority's protection and not for thepurposes of punishment. Debarment shall be imposed in accordance with the procedurescontained in this section. Debarment is intended as a remedy in addition to, and not insubstitution of, the evaluation of the responsibility of Authority bidders and contractors, and therejection or termination of Authority bidders and contractors based on findings of nonresponsibilityon a case-by-case basis.22.2 DefinitionsA. Civil judgment means any individual finding of a civil offense by any court ofcompetent jurisdiction.B. Contractor means any individual or other legal entity that:1. Directly or indirectly (e.g. through an affiliate), submits offers for or isawarded, or reasonably may be expected to submit offers for or beawarded, a Authority contract for construction or for procurement ofgoods or services, including professional services; or2. Conducts business, or reasonably may be expected to conduct business,with the Authority as an agent, surety, representative or subcontractor ofanother contractor.3. For the purposes of this section, the terms "vendor" and "consultant" havethe same meaning as "contractor." "Subconsultant" has the same meaningas "subcontractor."4. Conviction means a judgment or conviction of a criminal offense, be itfelony or misdemeanor, by any court of competent jurisdiction, whetherentered upon a verdict or a plea, and includes a conviction entered upon aplea of nolo contendere.C. Debarment means action taken by the debarment committee to exclude acontractor from Authority contracting and Authority-approved subcontracting fora reasonable, specified period as provided below and also means termination of anexisting contract; a contractor so excluded or whose contract has been terminatedis considered debarred.87|Page

D. Emergency means circumstances which would justify an emergency purchasepursuant to Section 112.313(12)(d), Florida Statutes; i.e. a contract made of inorder to protect the health, safety or welfare of the citizens" of the TWA servicearea.E. Indictment means indictment for a criminal offense. Information or other filingby competent authority charging a criminal offense shall be given the same effectas an indictment.F. Legal proceeding means any civil judicial proceeding to which the Authority is aparty or any criminal proceeding. The term includes appeals from suchproceedings.G. List of debarred contractors means a list compiled, maintained and distributed bythe Purchasing and Warehouse Department, containing the names of contractorsdebarred under the procedures of this section.H. Preponderance of the evidence means proof by information that, compared withthat opposing it, leads to the conclusion that the fact at issue is more probably truethan not.I. Termination means termination of a contract based upon proof that groundsexisted for debarment at the time the contract was entered into.22.3 List of Debarred ContractorsA. The Purchasing and Warehouse Department shall:1. Compile and maintain a current, consolidated list of all contractorsdebarred by the Authority. Such list shall be public record and availablefor public inspection and dissemination;2. Periodically revise and distribute the list and issue supplements, ifnecessary or upon request, to all departments, to the office of theAuthority's Executive Director, and to the Authority's Board ofSupervisors;3. In accordance with internal retention policies and procedures, maintainrecords relating to each debarment;4. Establish procedures to provide for the effective use of the list, includinginternal distribution thereof, to ensure that departments do not solicitbids/proposals from, award contracts to, or subcontract with contractors onthe list;88|Page

5. Respond to inquiries concerning listed contractors and coordinate suchresponses with the department that recommended the action.B. The list shall include:1. The names and addresses of all contractors debarred; in alphabetical order;2. The name of the department recommending initiation of the debarmentaction;3. The cause of the debarment action;4. The effect of the debarment action;5. The termination date for each listing;6. The name and telephone number of the point of contact in the departmentrecommending the debarment action.22.4 Effects of DebarmentDebarred contractors are excluded from receiving contracts, and departments shall not solicitoffers from, award contracts to, or consent to subcontracts with these contractors, unless theAuthority's Executive Director or his/her designee determines that an emergency exists justifyingsuch action and grants approval for such action. Debarred contractors are also excluded fromconducting business with the Authority as agents, representatives, subcontractors or partners ofother contractors.22.5 Continuation of Current ContractsA. Commencing on the effective date of this Manual from which this section derives,all proposed Authority contracts for construction, or for procurement of goods andservices, including professional services, shall incorporate this section and specifythat debarment may constitute grounds for exclusion of a contractor orsubcontractor or termination of any existing Authority contract.B. The debarment shall take effect in accordance with the notice provided by theAuthority's Executive Director pursuant to subsection below, except that if adepartment continues contracts or subcontracts in existence at the time thecontractor was debarred, the debarment period shall commence upon theconclusion of the contract, and in the interim the debarred contractor shall notenter into any Authority contracts.C. Departments may not renew or otherwise extend the duration of current contracts,or consent to subcontracts with debarred contractors, unless the Authority's89|Page

Executive Director or his/her designee determines that an emergency existsjustifying the renewal or extension or for an approved extension due to delay ortime extension for reasons beyond the contractors control. Completion of currentcontracts shall be permissible unless there is a contract termination.22.6 Restrictions on SubcontractingA. When a debarred contractor is proposed as a subcontractor for any subcontractsubject to Authority approval, the department shall not consent to subcontractswith such contractors unless the Authority's Executive Director or his/herdesignee determines that an emergency exists justifying such consent andapproves such decision.B. The Authority shall not be responsible for any increases in project costs or otherexpenses incurred by a contractor as a result of rejection of proposedsubcontractors pursuant to subsection (6)a. above, provided the subcontractor wasdebarred prior to bid opening or opening of proposals.22.7 DebarmentA. The debarment committee may, in the public interest, debar a contractor for anyof the causes listed in this section, using the procedures outlined below. Theexistence of a cause for debarment, however, does not necessarily require that thecontractor be debarred; the seriousness of the contractor's acts or omissions andany mitigating factors should be considered in making any debarment decision.B. Debarment or termination constitutes debarment of all officers, principals,directors, partners, qualifier, divisions, or other organizational elements of thedebarred contractor, unless the decision is limited by its terms to specificdivisions, organizational elements or commodities. The debarment committee'sdecision includes any existing affiliates of the contractor, if they are:1. Specifically named; and2. Given written notice of the proposed debarment and an opportunity torespond. Future affiliates of the contractor are subject to the pre-existingdebarment committee's decision.22.8 Causes for DebarmentA. The debarment committee may debar a contractor for:1. a conviction or civil judgment;90|Page

2. commission of a fraud or a criminal offense in connection with obtaining,attempting to obtain, performing, or making a claim upon a public contractor subcontract, or a contract or subcontract funded in whole or in part withpublic funds;3. violation of federal or state antitrust statutes relating to the submission ofoffers;4. commission of embezzlement, theft, forgery, bribery, falsification ordestruction of records, making false statements, or receiving stolenproperty; and5. commission of any other payment or performance related offenses thatseriously and directly affect the completion of one or more contracts or theperformance of the completed building, project, or goods or services.B. The debarment committee may also debar a contractor based upon any of thefollowing:1. Violation of the terms of an Authority contract or subcontract, or acontract or subcontract funded in whole or in part by Authority funds,such as willful failure to perform in accordance with the terms of one ormore contracts; or the failure to perform, or unsatisfactory performance ofone or more contracts;2. Violation of an Authority policy resolution or administrative order whichlists debarment as a potential penalty; and3. Any other cause of so serious or compelling a nature that it affects theresponsibility of an Authority contractor or subcontractor in performingAuthority work.22.9 Debarment ProceduresA. Investigation and referral. Departments shall promptly investigate and preparewritten reports concerning a proposed debarment and prepare written request forthe Purchasing and Warehouse Department for the debarment of contractors thedepartment believes is subject to any of the causes listed above. The Purchasingand Warehouse Manager or his/her designee may investigate, prepare writtenreports on, and prepare written requests for debarment of contractors orsubcontractors.B. Upon receipt of a request for debarment, the Purchasing and WarehouseDepartment shall create a debarment committee from the standing pool of91|Page

committee members appointed by the Authority's Executive Director or his/herdesignee, none of whose members shall include a representative from thedepartment making the debarment request. The Purchasing and WarehouseDepartment shall act as staff to the debarment committee. The departmentrequesting debarment shall present evidence and argument to the debarmentcommittee.C. Notice of proposal to debar. The Purchasing and Warehouse Department onbehalf of the debarment committee, shall issue a notice of proposed debarmentadvising the contractor and any specifically named affiliates, by certified mail,return receipt requested, or personal service that:1. Debarment is being considered;2. The reasons and causes for the proposed debarment in terms sufficient toput the contractor on notice of the conduct or transaction(s) upon which itis based;3. The notice shall also describe the effect of the issuance of the notice ofproposed debarment and of the potential effect of an actual debarment ;4. The time and place of a hearing on proposed debarment;5. That the contractor and any specifically named affiliates may appear andbe heard, with or without legal counsel and present evidence andtestimonyD. In actions based upon a conviction or judgment, or in which there is not genuinedispute over material facts, the debarment committee shall make a decision on thebasis of all the undisputed, material information in the administrative record,including any undisputed, material submissions made by the contractor. Whereactions are based on disputed evidence, the debarment committee shall decidewhat weight to attach to evidence of record, judge the credibility of witnesses, andbase its decision on the preponderance of the evidence standard. In the event thatthe contractor fails to appear at the debarment hearing or to present competentproof through persons with direct knowledge of the contractor's performance, thecontractor shall be presumed to be not responsive and subject to debarment. Thedebarment committee's decision shall be determined by a majority of the membersof the committee. The debarment committee shall be the sole trier of fact. Thehearing will be Quasi Judicial and will be heard in compliance with Florida'sSunshine Law. The committee's decision shall be made within 20 working daysafter conclusion of the hearing, unless the debarment committee extends thisperiod for good cause.92|Page

E. The committee's decision shall be in writing and shall include the committee'sfactual findings, the principal causes of debarment as enumerated in this section,identification of the contractor and all affiliates affected by the decision, and thespecific term, including duration of the debarment imposed.F. Notice of debarment committee's decision. If the debarment committee decides toimpose debarment, the purchasing director or his/her designee shall give thecontractor and any affiliates involved written notice specifying the reasons fordebarment and include a copy of the committee's written decision stating theperiod of debarment, including effective dates, and advise that the debarment iseffective throughout the Authority's departments. The contractor then has 72hours upon receiving written notice to appeal the decision of the debarmentcommittee to the Authority's Executive Director.G. If no notice is received by the Purchasing and Warehouse Department within the72-hour window, then all decisions of the debarment committee shall be final andshall be effective on the date the notice is signed by the Purchasing andWarehouse Manager or his/her designee unless overridden by the Authority'sExecutive Director through the debarment appeal process. The Authority'sExecutive Director or his/her designee shall state in writing the reasons for itsoverride of the debarment committee's decision.22.10 Period of DebarmentA. The period of debarment imposed shall be within the sole discretion of thedebarment committee. Debarment shall be for a period commensurate with theseriousness of the cause(s), and, where applicable, within the guidelines set forthbelow, but in no event shall such period exceed five years.B. The following guidelines in the period of debarment shall apply except:1. For commission of an offense as described in subsection (22.8)A.1.: fiveyears;2. For commission of an offense as described in subsection (22.8)A.2.: fiveyears;3. For commission of an offense as described in subsection (22.8)A.3.: fiveyears;4. For commission of an offense as described in subsection (22.8)A.4.: threeto five years;93|Page

5. For commission of an offense as described in subsection (22.8)A.1. or 2.:three to five years;6. For commission of an offense as described in subsection (22.8)B.3.: threeto five years;C. The debarment committee may, in its sole discretion, reduce the period ofdebarment, upon the contractor's written request, for reasons such as:1. Newly discovered material evidence;2. Reversal of the conviction or civil judgment upon which the debarmentwas based;3. Bona fide change in ownership or management;4. Elimination of other causes for which the debarment was imposed; or5. Other reasons the debarment committee deems appropriate.D. The debarred contractor's written request shall contain the reasons for requesting areduction in the debarment period. The Purchasing and Warehouse Department,with the assistance of the affected department shall submit a written responsethereto. The decision of the debarment committee regarding a request madeunder this subsection is final and non-appealable.94|Page

SECTION 23. DEFINITIONSAccept: to receive with approval or satisfaction; to receive with intent to retain.Acknowledgment: a form used to inform the buyer that the seller has accepted the order.Acquisition: the act of acquiring commodities or services for the use of a governmental activitythrough purchase or lease. Includes the establishment of need, description of requirements,selection of method of procurement, selection of sources, solicitation for offers, award ofcontract, finance, contract administration, and related functions.Addendum: an addition or supplement to a document, i.e., items or information added to aprocurement document.Advertising: the solicitation of competitive sealed bids through a form(s) of public notice, i.e.,newspapers, periodicals, and bulletin boards.Alternate Bid: the bid that invites for consideration one or more offers of an option or choicebased upon equipment or satisfactory performance by user, i.e., bid is only acceptable when thevariance is deemed to be immaterial.Analysis: a careful detailed examination – a study of offered prices; or the inspection ofpreferred goods to determine conformance with the requirements.Approving Official: an individual, officially appointed, who reviews each cardholder’sStatement of Account and verifies that all transactions were made in the best interest of theAuthority.Architectural & Engineering (A&E): professional services within the scope of the practice ofarchitecture and engineering involved in research, design, and construction of facilities.Auction: a public sale of property to the highest offer; note – public contracts for goods orservices may be negotiated, but not auctioned off to the lowest bidder.Authorized Deviation: deviations specifically permitted by contracting authority.Award: the presentation of a purchase agreement or contract to a bidder; the acceptance of a bidor proposal by the solicitor.Back Order: the undelivered portion of a current order, which the vendor agrees to ship later.Benchmark: a point of reference from which measurements can be made.Best Interest of the Authority: a term used in the absence of specific authority or instruction, toauthorize an official to use discretion in taking action deemed to be the most advantageous.95|Page

Bid: a competitive price offer made by an intended provider, usually in reply to a formalinvitation for bid. An offer made at a public auction.Bid Bond: a legally binding agreement provided by a third party (normally an insurancecompany or financial institution) guaranteeing in a required dollar equivalent that their client(bidder) will enter into a contract to perform/provide should their client’s offer be accepted bythe solicitor.Bid Deposit: any bank negotiable instrument in a form of a Certified Check, Cashier Check,Money Order, Bank Draft, or Trust Company Treasurer’s Check, deposited with and at therequest of the solicitor to guarantee that the bidder (depositor) will, if selected, enter into thecontract as bid. The deposit is forfeited for failure to enter into the contract.Bid File: a file listing individual bids by all vendors solicited in response to an IFB.Bidders Conference: a meeting of prospective bidders, arranged by the Purchasing andWarehouse Department, to help potential vendors understand the requirements of the IFB/RFP.(also see pre-bid/proposal conference)Bid Guarantee: see bid bond, bid deposit.Bid Opening: the actual physical process whereby the sealed bids are publicly opened at the prestatedlocation and time and made available for inspection by all interested persons.Bid Sample: a sample offered by a bidder as part of a bid; when required in an IFB, the samplesare examined and tested for conformance with the requirements of the IFB/RFP.Bid Security: see bid bond, bid deposit.Bidder: one who submits a response to an IFB.Bidders List: a list of names and addresses of suppliers from whom bids/proposals might beexpected; the list, maintained by the Purchasing and Warehouse Department, should include allsuppliers who have expressed interest in doing business with the Authority.Bill of Sale: a written statement transferring ownership of something from seller to buyer.Bin Tag: a tag attached to a storage bin on which a perpetual inventory is recorded.Blanket Purchase Order: a purchase order in which quantity or duration is not specified.Boilerplate: a colloquialism, used in purchasing to identify standard terms and conditionsincorporated in solicitation, contracts, or purchase orders usually preprinted and incorporated byreference.96|Page

Bona Fide: in good faith.Bond: a binding agreement, and/or sum of money put up for security to guarantee theperformance of certain duties.Brand Name: a brand or trademark, which identifies a product or service. Products are usuallyreferenced by model or part number. Note – a careful distinction must be made between brandname and sole source procurement actions.Brand Name or Approved Equal Specification: a specification that uses one or more numbersto describe the standards of quality, performance, and other characteristics needed to meetrequirements of a solicitation, and which provides for the submission of equivalent products.Breach of Contract: the breaking of a contract; failure to fulfill a contract wholly or in part.Breach of Warranty: the failure to meet the specifications of a warranty.Budget: a forecast of planned receipts and allocation of expenses for a specific period of time.Bulk Purchasing: purchasing in large quantities in order to reduce the price per unit; volumepurchasing.Buyer’s Market: a market condition which occurs when the supply exceeds the demand in acompetitive market.Buyer’s Option: the right, established in a purchase document, to buy an item or service at afixed price within a specified time.Cannibalize: to take unusable parts from equipment to be used as replacement parts for therepair of other equipment.Capability: the ability of a bidder to fulfill the contract at time of the award.Cardholder: individual with delegated written procurement authority by the appointing official.Cash Discount: a prompt payment discount from the total invoice price for the goods if thepurchaser pays within a specified period.Catalog: noun – a list of items, usually brief descriptions, systematically arranged. Verb – tomake a catalog to list items.Centralized Purchasing: a purchasing system with the authority, responsibility, and control ofpurchasing centralized.Certified Check: a check whose value is guaranteed by the bank upon which the check is drawn.97|Page

Change Order: purchaser’s written modification or addition to a purchase order.Check: a written order or draft directing a bank to pay money to the person or office named onthe check.Clarification: a communication with an offeror for the sole purpose of eliminating minorirregularities or apparent clerical mistakes in a bid/proposal. Either party to a contract mayinitiate the action. Clarification does not give an offeror an opportunity to revise or modify itsproposal, except for apparent clerical mistakes.Collusion: a secret agreement or cooperation between two or more persons to accomplish afraudulent, deceitful, or unlawful purpose.Commodity: an article of trade, a moveable article or tangible item that is produced or used asthe subject of barter or sale.Commodity Classification: the procedure, which identifies commodities according to type,class, size, composition, manufacturer, etc.Commodity Code: a system of words and numbers designed to list commodities or services byclasses and sub-classes.Competitive Bidding: the offer of firm bids by individuals or firms competing for a contract,privilege, or right to supply specified services or merchandise.Competitive Sealed Bidding: the process if publicizing government needs; inviting bids (IFB),conducting public bid openings, and awarding a contract to the lowest responsive andresponsible bidder; the preferred method of procurement.Competitive Sealed Proposal: the method of procurement used whenever competitive sealedbidding is not practicable. The process of publicizing government needs, requesting proposal(RFP) evaluation proposals received, negotiating proposals with acceptable or potentiallyacceptable offerors, and awarding the contract after consideration of evaluation factors in theRFP and the price offered.Concealed Damage: damage that is not apparent; hidden from view.Confidential Information: information, which is not a matter of public knowledge and must bekept confidential in the purchasing process, i.e. trade secrets, test data, etc.Conflict of Interest: the actual or potential conflict in which a person may gain from or holdinterest in a company doing business with his employer.Consideration: something of value given or done as a recompense, which is exchanged by twoparties; that which binds a contract.98|Page

Consultants/Experts: persons having education and/or experience, which uniquely qualify themto perform some specialized service.Consulting Services: services of an advisory nature relating to administration or managementfor the Authority; normally provided by persons and/or organizations to have the prerequisiteknowledge or special abilities not generally available.Consumer Price Index (CPI): measure of the average change in prices over time in a fixedmarket basket of goods and services.Contract: an agreement enforceable by law, between two or more competent parities, to do ornot to do something not prohibited by law, for a consideration. Any type of agreement or orderfor procurement of commodities or construction.Contract Administration: the management of all facets of contracts to assure the contractor’stotal performance is in accordance with his contractual commitments and that the obligations ofthe purchases are fulfilled.Contract Change Order: process used to request a modification to a contract.Contract, Firm-Fixed Price: a contract that provides for a price not subject to any adjustmentby reason of the cost experience of the contractor in the performance of the contract. Used forcontracts awarded after formal bidding; also used in negotiated contracts when reasonablydefinite specifications are available and costs can be estimated with reasonable accuracy toenable the negotiation of a fair price.Contract, Fixed-Price with Escalation: a fixed price type of contract that provides for theupward and downward revision of the stated contract price upon the occurrence of certaincontingencies, such as fluctuations in material prices and labor rates, specifically defined in thecontract.Cooperative Purchasing: the combining of requirements of two or more private or politicalentities in order to obtain the benefits of volume purchases and/or reduction in administrativeexpenses.Cost Analysis: the review and evaluation of a contractor’s cost or pricing data. May include thejudgmental factors applied in projecting from the data to the estimated costs in order to form anopinion. It includes appropriate verification of cost data, evaluation of specific elements ofcosts, and projection of these data to determine the effect on price factors, allowances forcontingencies and the basis used for allocation of overhead costs.Debar: to bar a person or company from participating in a procurement action because ofprevious illegal or irresponsible action; may be used as a noun, debarment.99|Page

Decentralized Purchasing: the distribution of purchasing operations to similar units ofmanagement, usually by delegation from a central authority, which retains policy direction.Delivery: the formal handing over of property. The transfer of possession, as by carrier topurchaser.Depreciation: a decrease in value because of use, time, deterioration, inadequacy, orobsolescence.Design Specification: a specification setting forth the required characteristics to be consideredfor award of contract and including sufficient detail to show how the product is to bemanufactured.Destination: the place to which a shipment is consigned.Dispute: the contesting of, and attempt to resolve, discrepancies encountered during the billingperiod.Distributor: a person or business not manufacturing its own products but buys and sells goodsfrom a manufacturer, usually maintaining an inventory.Emergency: the necessity for the immediate purchase of commodities or services essential toprotect the life, health, or safety of the public.Emergency Purchase: a purchase made in an emergency, often made under special procedures,designed to meet the urgency.Encumbrance: obligations are reserved in the form of purchase orders or contracts, which arechargeable to an appropriation. They cease to be encumbrances when paid or when the actualliability is set up.Equal or Equivalent: used to indicate that an item may be substituted for a required item if it ismatched, with no advantage on either side.Equipment: items of a durable nature that retain their identity throughout their useful life.Evaluation of Bids: the process of examining a bid after opening to determine the bidder’sresponsibility, responsiveness to requirements and other characteristics of the bid relating to theselection of the award bid.Expedite: follow up or trace to ensure prompt or hastened delivery of goods ordered bypurchaser, generally according to the contract terms.Express Warranty: the assurance as to certain facts written by a seller; a guarantee in theprecise words of the seller.100|Page

Fee: a sum of money asked or paid for some service, charge, or payment, usually forprofessional or technical service.Field Purchase Order: a dollar limited and specific purchase order used in situations whereauthority to make the type of purchase involved has been delegated to using agencies.Firm Bid: a definite price proposal as differentiated from an "estimated" bid. A bid that bindsthe bidder until a stipulated time of expiration.Fiscal Year: a period of twelve consecutive months selected as a basis for annual financialreporting, planning or budgeting.Formal Bid: a bid that must be submitted in a sealed envelope and in conformance with aprescribed format to be opened publicly at a specified time.Free On Board (F.O.B.): a shipping term defining the point at which the buyer takes legal titleto the goods, who is responsible for payment of freight, and who is responsible for prosecutingclaims against carriers for loss or damage to the goods in transit.Goods: all material, equipment, supplies, printing, and automated data processing hardware andsoftware.Identical Bid: a bid that agrees in all aspects with another bid. See Tie Bid.Informal Bid: a request for price quotations for commodity or service that does not require asealed bid or public opening or reading of bids.Informality: a minor defect or variation of a bid or proposal from the exact requirements of theIFB or RFP which does not affect the price, quality, quantity, or delivery schedule for the goodsor services being procured.Inventory: a stock of goods or an itemized list of a stock of goods indicating volume and values.Inventory Control: management supervision of estimated requirements, production,procurement, distribution, maintenance, and disposal of materials.Inventory Turnover: the number of times in a year that an entire inventory is issued andreplaced.Invitation for Bid (IFB): a formal request to prospective suppliers requesting price quotations.The term includes all documents that are attached or incorporated.Invoice: seller’s itemized document stating prices and quantities of goods and/or servicesdelivered and sent to buyer for payment.101|Page

Item: a single, separate thing, unit, article or product.Lead Time: the time that it would take a supplier to deliver goods after receipt of order.Letter of Credit: a document issued by a bank, which authorizes the bearer to draw money fromthat bank or its agents. It may extend credit up to a certain amount.Life Cycle Costing: a procurement evaluation technique which determines the total cost ofacquisition, operation, maintaining, and disposal of items being acquired; the lowest ownershipcost during time the item is in use.Line Item: an item of supply or service, specified in an IFB for which the bidder must bid aseparate price.Liquidated Damages: a sum agreed upon settlement of a breach of contract to be paid by theparty who breaches the contract.List Price: the price of an article published in a catalog, advertisement, or printed list fromwhich discounts if any, may be substituted.Lump Sum: the total price of a group of items, which are put together and priced as a whole;aggregate.Market Research: in procurement, the study of what people buy, when they buy, why they buy,and how they buy items to enable a purchasing department to arrive at the most suitableapproach to acquiring commodities and services.May: a careful writer will use may to request or grant permission, to express a contingency,condition, concession, purpose or result.Merchant: a person who buys and sells a commodity for profit; a trader.Mistake in Bid: an error in the presentation of a bid, which results in an incorrect price orcondition, which might affect the eligibility for the award of a contract.Modification: a formal alteration or change to a contract.Multiple Award: contracts awarded to more than one supplier for comparable commodities andservices.Negligence: the doing or omission of something a reasonably prudent person would not havedone or omitted under the circumstance.102|Page

Negotiation: contracting through the use of either competitive or other than competitiveproposals and discussions. Any contract awarded without using sealed bidding procedures is anegotiated contract.Net Price: price offered after all discounts, rebates, etc. have been allowed.NIGP: National Institute of Governmental Purchasing. A non-profit, educational and technicalassistance corporation of public purchasing agencies, and activities at the Federal, State andLocal levels of government.No Bid: a response to an IFB stating that respondent does not wish to submit an offer.Non-Responsive Bid: a bid that does not conform to the mandatory or essential requirements ofthe IFB.Obsolete: out of date; no longer in use or effectively usable.Offer: to bid, to present for approval.Offeror: a person who makes an offer.Open End Contract: a contract in which quantity or duration is not specified. See termcontract.Option to Renew: a contract clause that allows a party to reinstate the contract for an additionalterm.Order: an instruction issued to a supplier for goods to be delivered at a price.Originating Department: a unit of government that requisitions items through centralpurchasing.Packaging List: a document which itemizes in detail the contents of a particular package orshipment.Pallet: a portable platform upon which goods are placed in unit loads to facilitate stacking andhandling of mechanical equipment such as forklift trucks.Partial Payment: the payment authorized in a contract upon delivery of one or more units calledfor under the contract, or upon completion of one or more distinct items of service called forhereunder.Payment and Performance Bond: a bond furnished by an insurance company which guaranteesthat all suppliers and subcontractors will be paid and that all work will be performed.103|Page

Point of Origin: shipping point, the location where a shipment is received by a transportationline from the shipper.Pre-Bid/Proposal Conference: meeting held with prospective bidders/offerors prior to theformal solicitation of bids or proposals, to recognize state of the art limits, technical aspects,specifications, and standards relative to the subject and elicit bidders expertise and biddersinterest in pursuing the task.Price: the amount of money that will purchase a definite weight or other measure of acommodity.Price Agreement: a contractual agreement in which a purchaser contracts with a vendor toprovide the purchaser’s requirements at a predetermined price. Usually involves a minimumnumber of units, orders placed directly with the vendor by the purchaser, and limited duration ofthe contract.Procurement: the combined functions of purchasing, inventory control, traffic andtransportation, receiving, receiving inspection, storekeeping and salvage and disposal operations.Progress Payments: payments arranged in a purchase transaction paid in advance of delivery, oras specified percentages of the total purchase are delivered.Proposal: a request for prices which when submitted may be subject to further negotiation.Proprietary Item: an item produced and marketed by a person or persons having the exclusiveright to manufacture and sell it.Protest: a complaint about a governmental administrative action or decision brought by a bidderor vendor to the appropriate administrative section, with the intention of receiving a remedialresult.Public Purchasing: the process of obtaining goods and services for public purpose, followingprocedures implemented to protect public funds from being expended extravagantly orcapriciously.Purchase Order: a formal written, contractually binding document used to purchase goodsand/or services.Purchasing: the act and the function of responsibility for the acquisition of equipment,materials, commodities, and services.Purchasing Card: same as conventional credit cards with the exception that the Authority doesnot pay the standard interest rate.104|Page

Purchasing Cycle: the sequence of activities carried out by a purchasing department in theacquisition of goods and services.Purchasing Ethics: moral principles or code to be respected by purchasing personnel.Qualified Bidder: a bidder determined by a buying organization to meet minimum set standardsof business competence, reputation, financial ability, and product quality for placement on thebidders list.Qualified Products List (QPL): a list of products that because of the length of time required fortest and evaluation, are tested in advance of procurement to determine which suppliers complywith specification requirements.Quality: the composite of material attributes, including performance features and characteristicsof product and service to satisfy a given need.Quantity: amount or number.Quotation: an offer by a vendor to sell to the Authority. It may verbal or written. Used foritems less than the authorized bid limit.Reorder Point: the level of stock or inventory at which orders are placed to obtain more goods.Request for Quote (RFQ): a form of informal solicitation, including obtaining oral or writtenquotes from vendors, without formal advertising and receipt of sealed bids.Requirement: materials, personnel or services needed for a specific period of time.Requisition: an internal document by which a functional department sends to the Purchasing andWarehouse Department details of materials to meets its needs, replenish stocks or obtainmaterials for specific jobs or contracts.Responsible Bidder: a bidder or offeror who has the capability in all respects to perform fullythe contract requirements and the experience, integrity, perseverance, reliability, capacity,facilities, equipment, and credit which will assure good faith performance.Responsive Bidder: a vendor who has submitted a bid which conforms in all material respects tothe requirements stated in the IFB.Sample: one or more units of product selected from the material or process represented as aspecimen of quality.Scrap: material damage, defective, or deteriorated to the extent that it has no value except for itsbasic material content.105|Page

Services: any work performed by an independent contractor wherein the services rendered donot consist primarily of acquisition of equipment or materials or the rental of equipment,materials, and supplies.Single Purchase Limit: the limitation on the procurement authority delegated to the cardholder.The cardholder shall not exceed this amount on any single transaction. A transaction mayinclude multiple items, so long as the total dollar amount does not exceed this limit.Shall: denotes the imperative in contract clauses or specifications. Comparative with may.Sole Source: a sole source purchase exists when research has determined there is only onepotential provider for a good or service.Specifications: describe what is required or desired.Standardization: process of defining and applying the conditions necessary to ensure that agiven range of requirements can normally be met, with a minimum of variety, in a reproducibleand economic manner, based on the best source techniques.Stock: a supply of material maintained on hand at storage points in a supply system to meetanticipated demands for it.Stock Control: the process of maintaining inventory data on the quantity, location, andcondition of commodities and equipment due in, on hand, and due out. Done to determinequantities available for use and to facilitate distribution and management of material.Storage: the act of storing, or state of being stored, in a designated storage place for safekeeping.Subcontract: any contract, agreement, or purchase order and any contractual instrument withother than a prime contractor calling for the performance of any work, or for the making orfurnishing of any material, required for the performance of a prime contract.Supplier: furnishes the vendor.Tabulation of Bids: the recording of bids and bidding data that is submitted in response to aspecific invitation, for the purpose of price comparison and analysis for recommendation topurchase.Term Contract: a contract in which a source of supply is established for a specified period oftime for specified services or supplies; usually characterized by an estimated or definiteminimum quantity, with the possibility of additional requirements beyond the minimum, all atpredetermined unit price.106|Page

Terms and Conditions: a phrase generally applied to the rules under which all bids must besubmitted and the stipulations included in most purchase contracts often published by purchasingauthorities for the information of all potential bidders.Terms of Contract: stipulations made in contracts.Terms of Payment: the methods of payment under a sales contract.Tie-Bid: see identical bid.Unit Price: the price of a selected unit of a good or serviceVendor: one who sells something, also known as a bidder.Warranty: the representation either expressed or implied that a certain fact regarding the subjectmatter of contract is presently true or will be true.107|Page

CATEGORY: ConsentAttachment(s):Developer Service Agreement AmendmentAPPROVAL OF DEVELOPER SERVICE AGREEMENT AMENDMENT FOR PARADISECOVE PHASE 2Explanation: The Paradise Cove PH. 2 project, developed by B.C. Funding, is located onBass Road south of East Irlo Bronson Memorial Highway and executed a Developer ServiceAgreement (“DSA”) with the Tohopekaliga Water Authority (“TWA”) as a condition of water,reuse, and wastewater service on March 27, 2006.The DSA allowed the DEVELOPER to install and operate a private, temporary lift station untilthe Bass Road improvements, including a new gravity sewer system, were installed. Thetemporary lift station would be decommissioned with a connection to the gravity sewer plannedwith the Bass Road improvement project. At the time of approval, the County had 90% plansfor the Bass Road project and scheduled construction to begin within 6 months. However,after the DSA was executed and the Paradise Cove project was built and accepted, OsceolaCounty delayed the Bass Road project indefinitely and it is not included in the County’s fiveyear plan to construct.The Paradise Cove Phase 1 temporary private lift station has failed several times and hasrequired TWA to repair the lift station to mitigate health hazards and the Paradise Cove Ph. 1Homeowner’s Association is not financially able to maintain the lift station.To avoid similar issues with the Phase 2 lift station in the future, TWA staff has evaluated thecondition of the Phase 2 lift station and with the addition of a telemetry system, paid for by thedeveloper, to monitor the lift station, TWA staff recommends accepting ownership of the liftstation. TWA ownership will minimize issues the Authority has experienced with the Phase 1lift station.The amended agreement DSA conditions require:6. The DEVELOPER shall transfer ownership of the lift station for Paradise CovePhase 2 to TWA. TWA shall own and maintain the lift station including, but notlimited to, the wet well, pumps, and all related appurtenances.7. The DEVELOPER agrees to pay for the lift station telemetry in accordance withthe attached AGREEMENT FOR WATER AND/OR SEWER SERVICE (Exhibit‘A’)8. All other terms, conditions, and covenants of the Developer’s Service Agreementas recorded in OR Bk 3112/ Pgs 2135 through 2148 shall remain in full force andeffect.Recommendation: Staff recommends approval of the Developer Service AgreementAmendment for the Paradise Cove Phase 2 project.C-DSA AmendParadiseCovePh2.03.09.11.rb7D

CATEGORY: Consent 7EAttachment(s):Engineer’s Letter of RecommendationAPPROVAL OF BID FOR UTILITY IMPROVEMENTS OF HOAGLAND BOULEVARDWIDENING PROJECT PHASE IEXPLANATION: Osceola County is planning improvements to Hoagland Boulevard in threephases: the first phase extends from US-192 to 5th Street; the second phase extends from 5 thstreet and the Shingle Creek; the third phase extends from the Shingle Creek to the US 17-92.The phase I project is proceeding to construction. Phase 2 and 3 are in the design; theconstruction will not be initiated until the County is able to fund the construction phase of theprojects. These improvements will require Toho to relocate utilities in conflict with the roaddesign and provide an opportunity to extend a reuse main along the route.The Authority and the County have executed an interlocal agreement to construct theAuthority’s utility improvements and the County’s roadway improvements as one project. TheAuthority will be responsible for the utility costs and a prorated share of the projectConstruction and Engineering Inspection costs.The Phase I project utility work includes relocation of 485 lineal feet of existing 16” water main;replacement of approximately 1,700 lineal feet of 20” force main; abandonment and removal ofapproximately 1,800 lineal feet of 6” force main to avoid conflicts with the road design; andextension of approximately 5,100 lineal feet of 16” reuse main from US-192 to 5 th Street.Ground Penetrating Radar (GPR) and Subsurface Utility Excavations (SUEs) technologieswere utilized during the design to locate the existing utilities to minimize unforeseen conflictswith utilities and the road improvements.The County advertised the Phase I construction project in the Orlando Sentinel and theOsceola Gazette for two consecutive weeks. The bid opening was held by the County onDecember 14, 2010. Six bids were received and are listed below with the County’s bidevaluation:BidderPospiech Contracting,Inc.Jr. Davis ConstructionCompanyTotal BidAmountRoadway WorkBid AmountTWA UtilityWork BidAmount$4,196,527.78 $3,339557.06 $856,970.72$5,011,277.80 $3,797,028.30 $1,214,249.50EvaluationResultsBid Rejected byCountyValid Bid; Lowresponsive,responsible bidRanger Construction $5,303,737.03 $4,032,214.88 $1,271,522.75 Valid BidEmeril Utilities andSite Development, Inc.$5,438,642.62 $4,220,455.62 $1,218,187.00Bid Rejected byCounty

Middlesex Corporation $5,789,157.83 $4,658,285.83 $1,130,872.00 Valid BidLundquist Excavation,Inc.$5,846,004.59 $4,390,636.39 $1,455,368.20 Valid BidThe bids from Pospiech Contracting, Inc. and Emeril Utilities and Site Development, Inc. weredetermined non-responsible and rejected by the County.The County’s reasoning for rejecting Pospiech’s bid is:Pospiech did not use the bid form in the contract documents. The company submitted a bid ona form that did not replicate the established bid form. Their bid did not include Bid ItemNumbers (bid item number defines the pay item descriptions and measurement and paymentcriteria), and did not provide unit prices in a written (in words) format. In addition, their bid didnot include a price for the bid item “General Requirements, Bonds and Permits” for the utilitywork.Emeril Utilities and Site Development, Inc. does not possess Osceola County’s Class IPrequalification Status required by the County to bid project.The County staff will recommend contract award to Jr. Davis at the Board of CountyCommissioners (BoCC) meeting on March 14, 2011 based on the low total bid for the roadwayand utility improvements. Jr. Davis is also one of the Authority’s continuing contractors and is alocal firm.The engineer’s estimated construction cost for the utility improvements is $1,141,333.25.The Board is requested to approve the bid in the amount of $1,214,249.50 for the utilityimprovement to be constructed in conjunction with the roadway project contingent uponBoCC’s contract award to Jr. Davis on March 14, 2011.A 10% contingency fee in the amount of $121,500 is requested for this project.This construction project will be funded by 110009.RECOMMENDATION: Staff recommends approval of the bid in the amount of $1,214,249.50and a contingency fee of $121,500 for the Hoagland Boulevard Road Widening project Phase IUtility Improvements.Hoagland Boulevard Widening Project Phase I Reimbursement to County.lz.03/09/11

MemorandumDate: December 22, 2010To:TWAFrom: Shawn Hindle, P.E.Project ManagerRe:Hoagland Phase 1 Bid EvaluationThe attached spreadsheet includes both the roadway and utility portions of the project as theseitems were bid together for Hoagland Boulevard Phase 1. Rows 106 through 168 represent theutility portion of the bid.The average bid price for utility work in the contract is $1,191,195.03 and the apparent low bidprice secured from Pospiech Contracting, Inc. for the utility portion of the project was$856,970.72.Six bids were received for the project and they are ranked as follows based upon the total bidamount on the entire project (both roadway and utility):1. Pospiech Contracting, Inc. $4,196,527.782. Jr. Davis Construction Company $5,011,277.803. Ranger Construction $5,303,737.634. Emerald Utilities and Site Development, Inc. $5,438,642.62*5. The Middlesex Corporation $5,789,157.836. Lundquist Excavation, Inc. $5,846,004.59* Emerald Utilities and Site Development, Inc. was not a pre-qualified firm and therefore their bidshould be rejected by Osceola County and they will not be considered in this evaluation. For informationpurposes, the evaluation spread sheet has included the firm individually and the associated bid itemshave been eliminated from my analysis. Emerald USD columns are hidden on the spreadsheet as well toprevent any confusion.There are several concerns with the apparent low bid that must be considered in the finalevaluation of the bids and the recommendation for award. First and foremost, the bid wassubmitted on a computer generated form that did not replicate the established bid form.Specifically, the bid form submitted did not include Bid Item Numbers (bid item number definethe pay item descriptions and measurement and payment criteria) and did not provide unit pricesin a written (in words) format. The written unit price takes precedent in the bid documents andas the form submitted did not provide the unit price written in words the unit prices could not beverified as was done with other bids.Secondly, the bid submitted by Pospiech did not provide a bid on Item 7.00 GeneralRequirements, Bonds and Permits. The average bid submitted for this item was $18,248.00.

Please note: To avoid errors on the spreadsheet a value of $0.00 was placed in this line item forPospiech, however the bid form submitted left this item blank, therefore I must consider this asan irregularity as the bid is incomplete.Finally, as standard bid evaluation procedures any item within 5% of the average bid price isconsidered acceptable, items between 10 and 25% of the average bid price are evaluated as thisraises a flag for clarity and accuracy of the bid item intent, and any item over 25% of the averagebid price is reviewed in depth to include an explanation from the contractor acknowledging theintent is reflected in the bid item as presented. The bid from Pospeich included 2 items ofconcern per the analysis, which were items 5.90 (20” Line Stop) and 5.12 (20”x20” wet tap). 36additional items were flagged as the unit price being extremely low and several of the items wereof concern as to whether the materials and labor could be provided for the price quoted.Based upon the above concerns, and the irregularities of the bid quoted above, it is myrecommendation that the bid received from PospiechContracting, Inc, be deemed irregular andremoved from consideration for award.Evaluating the second low bid, Jr. Davis’ Construction Company, is 8.68% lower than theaverage of the remaining four bids and 4.24% lower on the average of the utility items whenisolated from the overall bid. While Jr. Davis Construction Company is the second apparent lowbidder on the overall project he is actually the third low on the utility portion to Pospeich andMiddlesex. Pospiech has been recommending to be removed from consideration and thedifference between the second and third utility bids is approximately 7%.In evaluating the bid received from Jr. Davis, there are four unit prices that have raised aconcern. Two of the items are lump sum items (1.0 – Mobilization and 2.0 – Locate Utilities inAdvance of Construction). The lump sum item for mobiliazation is in line with the engineer’sestimate and while not a large number the utility locate item is above the engineer’s estimate butthe methodology for locating the improvements could result in larger maintenance of traffic andequipment costs should the contractor choose to excavate the existing mains with a backhoe.The other items were 3.4 (within Engineer’s estimate), 3.9 (acceptable bid amount) and item 3.12(item of concern). Item 3.12 is 8” – 45 degree bends at a unit price of $675.00 which is morethan double the average cost bid on these items. It is my suggestion that if the project has in anincreased quantity of these bends that any change order consider the use of a cost plusitemization.All other conditions of the bid submitted by Jr. Davis appear to be acceptable and complete.Therefore, it is my recommendation that Tohopekaliga Water Authority accept the bid receivedfrom Jr. Davis Construction Company, contingent upon the Osceola County doing the same inaccordance with the executed interlocal agreement.If you have any questions or would like me to perform any background/reference checks pleaselet me know.

Agenda: ConsentAPPROVAL OF SPONSORSHIP FOR DARK SKY FESTIVAL @ HARMONYExplanation: Dark Sky Festival at Harmony is an educational event created to call attentionto the beauty of the night sky and the importance of protecting it from being lost to the wastefullighting practices. Harmony is a planned conservation community that promotes the use ofconservation practices through the use of builders who utilize Energy Star products in everyhome they build. The event scheduled for April 9, 2011 from 7:00 – 11:00 pm will promoteconservation of natural resources.The Dark Sky Festival event is being planned as a fun and educational community event thatwill include educational exhibits, informative speakers, a Kid’s Zone, and live entertainment.Sponsorship of the event at the $800.00 level will provide Toho with the Main Stage sponsortitle, opportunity to speak for a 60 second “plug” between scheduled events on stage, the Tohologo printed on all print advertisements, posters, direct mail pieces, a link to Toho’s website onDarkskyfestival.com, a 10x10 booth space during the event, a banner displayed on stage, andrecognition from the stage during the event.The request for sponsorship of the 2011 event meets the criteria outlined by Toho WaterAuthority Board of Supervisors Community Sponsorships and Contributions Policy (TWA 2004-01)Recommendation: Staff recommends a sponsorship in the amount of $800.00 for thiseducational event.DarkskyfestivalSponsorship.03.09.11.mg7F

CATEGORY:Informational PresentationAttachment(s): Investment Report for the Quarter Ending December 31, 2010QUARTERLY INVESTMENT REPORT BY PFM GROUP - QUARTER ENDING DECEMBER31, 2010Explanation: On March 11, 2009, the Board approved an investment strategy outlined byStaff and Investment Advisor, The PFM Group.A representative from The PFM Group will present the investment report for the quarter endingDecember 31, 2010 and be available to answer any questions.Recommendation:No action requiredInvestment Report Presentation for QE Dec 31.03.09.11.rh8

Tohopekaliga Water AuthorityInvestment Performance ReviewQuarter Ended December 31, 2010Investment AdvisorsSteven Alexander, CTP, CGFO, Managing DirectorMel Hamilton, Senior Managing ConsultantDavid Jang, CTP, Senior Managing ConsultantGregg Manjerovic, CFA, Portfolio ManagerRebecca Dole, CTP, Consultant300 S. Orange Avenue, Suite 1170Orlando, FL 32801(407) 648-2208(407) 648-1323 faxPFM Asset Management LLCOne Keystone Plaza, Suite 300North Front & Market StreetsHarrisburg, PA 17101-2044717-232-2723717-233-6073 fax

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Table of ContentsTab I.Section A Market ReviewTab II.Section B Executive Summary and Impact Fee Portfolio PerformanceSection C Operating Portfolio PerformanceSection D Asset Allocation ChartTab III.December 31, 2010 PFM Month-End StatementPFM Funds December 31, 2010 Month-End StatementThis material is based on information obtained from sources generally believed to be reliable and available to thepublic, however PFM Asset Management LLC cannot guarantee its accuracy, completeness or suitability. Thismaterial is for general information purposes only and is not intended to provide specific advice orrecommendation. The information contained in this report is not an offer to purchase or sell any securities.Table of ContentsSection i

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010TAB I

Tohopekaliga Water Authority Investment Report – Quarter Ended December 31, 2010A sharp mid-quarter interest rate reversal drove intermediate- and longterminterest rates higher, ending a seven-month trend of lower rates. As aresult longer-duration fixed income portfolios posted negative returns forthe fourth quarter, but over the full year they out-performed cashinvestments by significant margins. In the quarter, corporate and FederalAgency securities outperformed comparable U.S. Treasuries and had apositive effect on accounts that held these investments.The market-reversal followed the early November announcement by theFederal Reserve of a plan to purchase up to $600 billion of U.S. Treasurysecurities through June 2011 via a second round of Quantitative Easing(“QE2”). Quantitative easing is a form of monetary policy in which acentral bank attempts to keep yields low by creating money to purchasefixed income securities, thereby decreasing the supply of such securities.In the weeks leading up to the Federal Reserve’s decision to implementQE2, investors began aggressively purchasing U.S. Treasuries in anattempt to front-run the announcement, causing U.S. Treasury prices toincrease sharply. Following the Fed’s official announcement of QE2,yields across all sectors (corporate, municipal, U.S. Treasury, and FederalAgency) actually increased due to a combination of positive economicdata and increased expectations for growth and future inflation.U.S. interest rate movements were paralleled in Europe where theEuropean Central Bank (ECB) acted to alleviate sovereign debt concernsby purchasing Greek, Irish, and Portuguese bonds in addition to othereuro-region government and corporate bonds. Since the program’sinception in May 2010, the ECB purchased over €72.5 billion ($95.5billion) of European sovereign debt. Quarter-over-quarter, the yield on10-year German Bunds increased by over 65 basis points while yields on10-year bonds issued by the French government increased by 64 basispoints. Concerns over possible default by Ireland from earlier in thequarter dissipated after Ireland accepted an €85 billion ($112 billion)bailout package from the European Union and International MonetaryFund. Such actions combined to boost global investor optimism and pushinterest rates higher.Interest Rates and ReturnsIntra-quarter volatility was high as 2-year U.S. Treasuries hit a record lowof 0.33% on November 12 before peaking to 0.73% on December 29 andending the quarter at 0.59%. The 17 basis point increase is the greatestquarter-over-quarter change in a year. As illustrated in the followingtable, yields on intermediate- and long-term U.S. Treasuries alsoincreased. Short-term rates remained anchored to the Federal Funds targetrange of 0.00% to 0.25%.Summary of U.S. Treasury Security YieldsDate 3M 6M 1Y 2Y 3Y 5Y 10YDecember 31, 2010 0.12% 0.18% 0.26% 0.59% 0.99% 2.01% 3.29%September 30, 2010 0.15% 0.19% 0.25% 0.42% 0.63% 1.26% 2.51%Change over Quarter -0.03% -0.01% 0.01% 0.17% 0.36% 0.75% 0.78%December 31, 2009 0.05% 0.19% 0.44% 1.14% 1.68% 2.68% 3.84%Change over Year 0.07% -0.01% -0.18% -0.55% -0.69% -0.67% -0.55%Source data: BloombergAs illustrated in the following chart, even with the back-up, 2-year U.S.Treasury yields remain below year-to-date highs set last January andApril but have increased significantly since hitting record lows inNovember of 2010.2-Year U.S. Treasury Note YieldJanuary 1, 2009 through December 31, 20101.50%1.25%1.00%0.75%0.50%0.25%0.00%Jan 09 Apr 09 Jul 09 Oct 09 Jan 10 Apr 10 Jul 10 Oct 10Source data: BloombergThe yield on 2-year U.S. Treasury notes, which is influenced by overnightrates, increased less than 10-year U.S. Treasury notes, which is morePFM Asset Management LLC Section A - 1

Tohopekaliga Water Authorityaffected by inflation andgrowth expectations. As illustrated in the chartbelow, the steepness of the U.S. Treasury yield curve, measured as thespread between 2- and 10-year U.S. Treasuries, reached record highs inDecember 2010. As of December 31, the spread was 270 basis points. Asteeper yield curve generally signals that the pace of economic growthand/or future inflation will increase.U.S. Treasury Yields and Yield Curve SteepnessDecember 2000 to December 20107%3.0%Investment Report – Quarter Ended December 31, 2010benchmark was 3.80 years, more than twice that of the 1- to 3-year U.S.Treasury benchmark with a duration of 1.85 years.Total Returnsof Merrill Lynch U.S. Treasury IndicesQuarterly and 12-Month Total Return as of December 31, 20107%6%5.69%5%6%2.4%4%3.61%5%1.8%3%2%2.35%Yields4%3%2%1%1.2%0.6%0.0%-0.6%Spread1%0%-1%-2%0.04%0.13%3mo-0.15%1-3yr-0.67%1-5yr-1.55%3-5yr0%-1.2%Dec00 Dec 02 Dec 04 Dec 06 Dec 08 Dec 10Spread (Right Axis) 2-Year TSY 10-Year TSYSource data: BloombergIn 2010, portfolios with longer durations outperformed shorter portfoliosas a result of declining interest rates. Even with negative returns for thefourth quarter, 1 to 3-year U.S. Treasuries returned 2.35% for the year,which is significantly above bank deposits and money market funds withyields near zero.Portfolioswith longer durations have more price sensitivity to changes ininterest rates than do shorter duration portfolios; thus the3- to 5-year U.S.Treasury benchmark returned -1.55% inthe quarter (-6.01% annualized)and 5.69%for the year. The duration of the 3- to 5-year U.S. TreasuryPFM Asset Management LLCQuarter 1 YearSource data: Bank of America Merrill Lynch; BloombergFederalAgency and corporate securities out-performed comparableTreasuries. Spreads between U.S. Treasuries and Federal Agenciesgenerally widened for longer maturities, but remained narrow by historicalstandards. The 10-year average spread between 2-year U.S Treasuries andFederalAgencies has been 0.35%, while they are currently at 0.15%.Spreadson 10-year obligations have historically tradedd at 0.50% and theyare currently at 0.30%.Spreadsbetween U.S. Treasuries and corporate securities remainedgenerally unchanged onthe short end of the curve andslightly tightenedon the long end of the curve. As shownin the chart on the next page, on aduration-adjusted basis,corporate benchmarks outperformed both FederalSection A - 2

Tohopekaliga Water Authority Investment Report – Quarter Ended December 31, 2010Agency and U.S. Treasury benchmarks as a result of the higher incomegenerated by corporate securities.Duration Adjusted Returns of Merrill Lynch 1-3 Year IndicesQuarterly and 12-Month Total Return as of December 31, 20105%4%3%2%1%0%-1%Improving credit and stable spreads led us generally to increase corporateholdings to take advantage of the incremental yield offered on highlyratedissuers. We will remain cautious with regard to issuer concentrationdue to continued expectations of high volatility and uncertaintysurrounding the pace of economic recovery, which may impact creditspreads.Economic Outlook2.35% 2.36%-0.15% -0.09% 0.11%3.96%U.S. Treasury Federal Agency AA/AAA CorporateCurrent QuarterPast 12 MonthsSource data: Bank of America Merrill Lynch; BloombergDuration-adjusted return incorporates an adjustment to the market value return(but not the income return) of each benchmark to account for their varieddurations, making it easier for investors to assess the relative risk and return ofbenchmarks of different lengths.Economic data indicated some signs of improvement in the fourthquarter. GDP appeared to accelerate towards the end of the year.The housing sector remained weak and continues to be a drag on theeconomy. Housing starts remained at depressed levels throughout thequarter and new home sales remain well below 15-year historicalaverages. The Case-Shiller Home-Price Index continued to show fallinghome prices, and building permits remained disappointing throughout thequarter.While the unemployment rate remains elevated, there have been somepositive developments in the labor market. December’s initial joblessclaims number of 388,000 was the lowest level since July 2008, whileboth the 3- and 6-month moving averages for initial jobless claims appearto show a downward trend from mid-2010 plateaus as illustrated in theaccompanying chart. Continuing jobless claims also demonstrate a similardownward trend.Initial Jobless Claims, ThousandsCurrent vs. 3-Month Moving Average vs. 6-Month Moving AverageJanuary 1, 2009 to December 31, 2010700600500400300200100-Jan 09 Apr 09 Jul 09 Sep 09 Dec 09 Mar 10 Jun 10 Sep 10 Dec 106-month Moving Average 3-month Moving Average Current ReadingSource data: BloombergHowever, the consumer remains strained as personal income and personalspending showed only marginal improvements in the fourth quarter. Forthe year, over 1.5 million Americans filed for personal bankruptcy, whichrepresents a 9% increase from 2009.Economists generally expect that the passing of the Tax Relief,Unemployment Insurance Reauthorization, and Job Creation Act of 2010PFM Asset Management LLC Section A - 3

Tohopekaliga Water Authority Investment Report – Quarter Ended December 31, 2010in December will give the economy a boost over the next year. Includedin the legislation was an extension of the Bush-era tax cuts and reductionof the FICA payroll tax, both of which are designed to spur growth viaadditional consumer spending. The bill also included an extension offederal unemployment benefits. The fiscal impact is about equal to that ofthe American Recovery and Reinvestment Act, though the emphasis is onboosting consumer spending, whereas the first stimulus programcontained large federal construction and state and local government aidprograms.The pace of manufacturing activity continued to accelerate as evidencedby strong Philadelphia Fed and ISM Manufacturing numbers. Capacityutilization, which measures the relationship between actual output andpotential output, continued to increase but remains significantly belowpre-financial crisis levels.Gold reached record highs in December and finished up 29.67% for theyear, while oil traded above $91 per barrel for the first time since October2008. The S&P 500 reached 2-year highs in December and ended the yearup 15.06%.Investment StrategyWith the prospect for higher rates ahead, investors are faced with thechoice of keeping money in cash for a future chance to invest at higherrates or investing now to take advantage of the positively sloped yieldcurve. Our view is that short-term rates will remain low for theforeseeable future as the Fed keeps its easy money bias in place, and thatthis presents an opportunity for a return that exceeds the near-zero rate oncash. The economic recovery will take some time to accelerate to thepoint where unemployment falls to acceptable levels and/or inflationtakes hold. Meanwhile we plan to continue to take advantage of thesharply-sloped yield curve. We also expect to continue to add corporateexposure where permitted to take advantage of incremental yield versusU.S. Treasuries. We remain cautious in executing this strategy becausewe recognize that with rates not far from historic lows there is more roomfor them to widen than narrow from here.PFM Asset Management LLC Section A - 4

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010TAB II

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Executive SummaryPORTFOLIO STRATEGY‣ The Authority’s Impact Fee and Operating portfolios are of high credit quality and maintain adequate liquidity. The portfolios are invested entirely inFederal Agency, U.S. Treasury, Commercial Paper and FDIC guaranteed corporate securities. The securities are allocated among high quality issuersrated AAA and A-1+.‣ Intermediate-term Treasury yields declined to record lows over the quarter. Two-year U.S. Treasury rates closed at 0.33% in early November, spurredby the announcement of a second round of quantitative easing (“QE2”) by the Federal Reserve at its November 3 rd FOMC meeting. The Fed called foran additional $600 billion in longer-term Treasury purchases through June 2011 in an attempt to reduce corporate, consumer, and mortgage borrowingrates, thus stimulating economic growth through corporate investment and support for the housing sector. By the end of the fourth quarter of 2010, theFed had purchased nearly $168 billion in Treasury securities.‣ By the end of the quarter, intermediate-term yields increased sharply from record lows in early November, but remained well below long-term historicalaverages. The yield increases were due in part to increased inflation expectations as a result of QE2, as well as the extension of the Bush-era tax cuts,which will add an additional $858 billion to the economy over two years. The two-year U.S. Treasury yield ended the quarter at 0.59%, closing 0.17%higher than it opened.‣ Overall economic conditions appear to be improving. For example, third quarter GDP was 2.6%, a substantial improvement over second quarter GDP.However this level of growth remains insufficient to impact the problematically high unemployment rate. Nonetheless, the unemployment rate was9.4% in December, the lowest reading of the year. At the same time, the number of discouraged workers hit a record high 3.1 million – these workersare not counted in the headline unemployment rate.‣ Over the course of the quarter, we were able to use active management strategies to take advantage of the volatility in yields. In the Impact Fees andOperating portfolios we made several sector swaps in addition to extension trades. For example, in October we sold federal agency and Treasurysecurities in the two month- to one-year maturity range and targeted purchases in the three-year area – this strategy resulted in realizing over $62,000in gains on sales. The Portfolios realized over $295,000 in gains on sales during the quarter.‣ At the beginning of the quarter, we targeted the Impact Fee and Operating portfolios’ durations at 78-82% of the benchmark’s duration in order tobenefit from the yield and roll down offered by the steep yield curve. Over the quarter, as rates increased and the yield curve steepened further, weextended the durations of the portfolios closer to the benchmarks’ duration. The Impact Fee Portfolio’s return of -0.12%, outperformed the benchmark’sreturn of -0.15% by 3 basis points (0.03%). The Operating Portfolio’s return of -0.15%, performed in line with the benchmark’s return of -0.15%. Theextension trades were done in October and November to take advantage of rising rates. However, when Congress passed the Fiscal Stimulus packagein mid-December rates continued to rise resulting in the Portfolios’ total return performances to be negative for the quarter.‣ PFM will continue to follow the prudent investment strategies that have safely provided the Authority with favorable long-term performance during thisperiod of historic low interest rates.‣ Rates have bounced back from all-time lows, but remain depressed from a historical standpoint. The Fed is signaling that it plans to continue to keeprates low for an extended period. As such, we will position the portfolios’ duration close to the benchmark’s duration in order to capitalize on addedyield and roll down. We will closely monitor the markets to make select purchases of securities when rates move towards the upper end of their range.‣ Agency spreads over Treasuries continue to be compressed. We will allocate about 35-40% of the portfolios to Treasuries. In the case that spreadswiden, Treasuries could outperform agencies. At that point, we will restructure the portfolios, allocating a larger portion to agency securities.PFM Asset Management LLC Section B - 1

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Impact Fee Portfolio PerformanceTotal Portfolio Value 1,2 December 31, 2010¹ September 30, 2010Market Value $57,906,338.21 $53,940,092.72Amortized Cost $57,725,422.79 $53,314,830.85Quarterly Return Calendar Year Last Last Since InceptionTotal Return 1,2,3,4,5,6,7,8 December 31, 2010 To Date 12 Months 24 Months 3/31/2009Impact Fee Portfolio -0.12% 2.34% 2.34% N/A 2.34%Merrill Lynch 1-3 Year U.S. Treasury Index -0.15% 2.35% 2.35% N/A 1.73%Effective Duration (Years) 4 December 31, 2010 September 30, 2010 Yields December 31, 2010 September 30, 2010Impact Fee Portfolio 1.77 1.47 Yield at Market 0.86% 0.80%ML 1-3 Year U.S. Treasury Index 1.77 1.81 Yield at Cost 1.09% 1.43%Portfolio Duration % of Benchmark Duration 100% 82%ReturnQuarter Total Return ComparisonQuarter Ended 12/31/100.50%0.25%0.00%-0.25%-0.50%Impact Fee Portfolio-0.12% -0.15%ML 1-3 Year U.S. Treasury Index-0.75%-1.00%-1.25%0.50 1.00 1.50 2.00 2.50 3.00Effective Duration (Years)ReturnSince Inception Total Return ComparisonPeriod Ended 12/31/103.00%2.75%2.50%2.25%2.00%1.75%Impact Fee Portfolio2.34%ML 1-3 Year U.S. Treasury Index1.73%1.50%1.25%1.00%0.50 1.00 1.50 2.00 2.50 3.00Effective Duration (Years)Notes:1. In order to comply with GASB accrual accounting reporting requirements; forward settling trades are included in the monthly balances. For September there were $4,035,447.09 in forward settling trades.2. End of quarter trade-date market values of portfolio holdings, including accrued interest.3. Performance on trade date basis, gross (i.e., before fees), is in accordance with The CFA Institute’s Global Investment Performance Standards (GIPS).4. Merrill Lynch Indices provided by Bloomberg Financial Markets.5. Quarterly returns are presented on both an unannualized and annualized basis. The annualized return assumes the quarterly return is compounded at the same ratefor four quarters and is presented for reference only. The actual annual return will be the result of chaining the most recent four quarterly returns.6. Includes money market fund/cash in performance and duration computations.7. Returns presented for 12 months or longer are presented on an annual basis.8. Past performance is not indicative of future results.PFM Asset Management LLC Section B - 2

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Impact Fee Portfolio Composition and Credit Quality CharacteristicsSecurity Type 1 December 31, 2010 % of Portfolio September 30, 2010 % of Portfolio Permitted by PolicyU.S. Treasuries $21,922,769.41 37.86% $11,010,586.23 20.41% 100%Federal Agencies 29,643,198.21 51.19% 35,896,165.01 66.55% 100%Commercial Paper 1,299,126.40 2.24% 1,297,687.30 2.41% 15% / 30%Certificates of Deposit 0.00 0.00% 0.00 0.00% 30%Bankers Acceptances 0.00 0.00% 0.00 0.00% 40%Repurchase Agreements 0.00 0.00% 0.00 0.00% 100%Municipal Obligations 0.00 0.00% 0.00 0.00% 100%Corporate Notes/Bonds 0.00 0.00% 0.00 0.00% 30%Corporate Notes - FDIC insured 1,008,429.00 1.74% 2,004,323.43 3.72%Mortgage Backed 2,962,320.35 5.12% 3,392,806.02 6.29% 20%Money Market Fund/Cash 1,070,494.84 1.85% 338,524.73 0.63% 20% / $30 MillionTotals $57,906,338.21 100.00% $53,940,092.72 100.00%U.S.Treasuries38%Portfolio Compositionas of 12/31/10Credit Quality Distribution² ³as of 12/31/10Money MarketFund/Cash1.85%AAA59%A-1+ (Shortterm)2%MortgageBacked5%CorporateNotes - FDICinsured2%CommercialPaper2%FederalAgencyObligations51%TSY39%Notes:1. End of quarter trade-date market values of portfolio holdings, including accrued interest.2. Credit rating of securities held in portfolio, exclusive of money market fund.3. A rating of "TSY" indicates the security is an obligation of, or explicitly guaranteed by the U. S. Government.PFM Asset Management LLC Section B - 3

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Impact Fee Portfolio Maturity DistributionMaturity Distribution 1 December 31, 2010 September 30, 2010Overnight (Money Market Fund) $1,070,494.84 $338,524.73Under 6 Months 2,724,238.75 2,305,674.306 - 12 Months 2,018,684.98 2,496,296.401 - 2 Years 15,720,621.93 19,772,135.032 - 3 Years 31,409,841.48 21,724,779.543 - 4 Years 3,001,276.57 5,067,486.994 - 5 Years 235,385.65 261,953.145 Years and Over 1,725,794.01 1,973,242.59Totals $57,906,338.21 $53,940,092.7260%50%Portfolio Maturity Distribution¹54.2%December 31, 2010September 30, 2010Percentage of Total Portfolio40%30%20%10%0%40.3%36.7%27.1%9.4%1.8%4.7% 4.3%5.2%3.5%4.6%0.6%0.4% 0.5%3.0% 3.7%Overnight Under 6 Months 6 - 12 Months 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years 5 Years and OverNotes:1. Callable securities in portfolio are included in the maturity distribution analysis to their stated maturity date, although they may be called prior to maturity.PFM Asset Management LLC Section B - 4

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Impact Fee Portfolio Maturity Distribution versus the Benchmark¹25.0%20.0%Market Value15.0%10.0%5.0%0.0%Years to MaturityImpact Fee PortfolioMerrill Lynch 1-3 Year U.S. Treasury Note IndexNotes:1. Due to the nature of the security, Mortgage-Backed Securities are represented based on their average life maturity rather than their final maturity.PFM Asset Management LLC Section B - 5

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Operating Portfolio PerformanceTotal Portfolio Value 1,2 December 31, 2010 September 30, 2010Market Value $32,104,345.25 $30,002,766.12Amortized Cost $32,036,301.69 $29,740,446.23Quarterly Return Calendar Year Last Last Since InceptionTotal Return 1,2,3,4,5,6,7,8 December 31, 2010 To Date 12 Months 24 Months 3/31/2009Operating Portfolio -0.15% 2.16% 2.16% N/A 2.18%Merrill Lynch 1-3 Year U.S. Treasury Index -0.15% 2.35% 2.35% N/A 1.73%Effective Duration (Years) 4 December 31, 2010 September 30, 2010 Yields December 31, 2010 September 30, 2010Operating Portfolio 1.73 1.40 Yield at Market 0.74% 0.51%ML 1-3 Year U.S. Treasury Index 1.77 1.81 Yield at Cost 0.98% 1.08%Portfolio Duration % of Benchmark Duration 98% 78%ReturnQuarter Total Return ComparisonQuarter Ended 12/31/100.50%0.25%0.00%-0.25%-0.50%Operating PortfolioML 1-3 Year U.S. Treasury Index-0.15% -0.15%-0.75%-1.00%-1.25%0.50 1.00 1.50 2.00 2.50 3.00Effective Duration (Years)ReturnSince Inception Total Return ComparisonPeriod Ended 12/31/102.75%2.50%2.25%2.00%1.75%Operating Portfolio2.18%ML 1-3 Year U.S. Treasury Index1.73%1.50%1.25%1.00%0.50 1.00 1.50 2.00 2.50 3.00Effective Duration (Years)Notes:1. In order to comply with GASB accrual accounting reporting requirements; forward settling trades are included in the monthly balances.2. End of quarter trade-date market values of portfolio holdings, including accrued interest.3. Performance on trade date basis, gross (i.e., before fees), is in accordance with The CFA Institute’s Global Investment Performance Standards (GIPS).4. Merrill Lynch Indices provided by Bloomberg Financial Markets.5. Quarterly returns are presented on both an unannualized and annualized basis. The annualized return assumes the quarterly return is compounded at the same ratefor four quarters and is presented for reference only. The actual annual return will be the result of chaining the most recent four quarterly returns.6. Includes money market fund/cash in performance and duration computations.7. Returns presented for 12 months or longer are presented on an annual basis.8. Past performance is not indicative of future results.PFM Asset Management LLC Section C - 1

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Operating Portfolio Composition and Credit Quality CharacteristicsSecurity Type 1 December 31, 2010 % of Portfolio September 30, 2010 % of Portfolio Permitted by PolicyU.S. Treasuries $11,838,706.17 36.88% $10,671,739.19 35.57% 100%Federal Agencies 12,520,706.90 39.00% 11,784,956.55 39.28% 100%Commercial Paper 2,449,901.58 7.63% 2,450,702.83 8.17% 15% / 30%Certificates of Deposit 0.00 0.00% 0.00 0.00%Bankers Acceptances 0.00 0.00% 0.00 0.00% 30%Repurchase Agreements 0.00 0.00% 0.00 0.00% 40%Municipal Obligations 0.00 0.00% 0.00 0.00% 100%Corporate Notes/Bonds 0.00 0.00% 0.00 0.00% 100%Corporate Notes - FDIC insured 4,811,411.42 14.99% 4,850,189.74 16.17% 30%Mortgage Backed 0.00 0.00% 0.00 0.00%Money Market Fund/Cash 483,619.18 1.51% 245,177.81 0.00% 20%Totals $32,104,345.25 100.00% $30,002,766.12 99.18%Money MarketFund/Cash1.51%Portfolio Compositionas of 12/31/10U.S.Treasuries37%AAA55%Credit Quality Distribution² ³as of 12/31/10A-1+ (Shortterm)8%CorporateNotes - FDICinsured15%CommercialPaper8%FederalAgencyObligations39%TSY37%Notes:1. End of quarter trade-date market values of portfolio holdings, including accrued interest.2. Credit rating of securities held in portfolio, exclusive of money market fund.3. A rating of "TSY" indicates the security is an obligation of, or explicitly guaranteed by the U. S. Government.PFM Asset Management LLC Section C - 2

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Operating Portfolio Maturity DistributionMaturity Distribution 1 December 31, 2010 September 30, 2010Overnight (Money Market Fund) $483,619.18 $245,177.81Under 6 Months 3,256,644.78 3,257,092.436 - 12 Months 1,173,634.77 0.001 - 2 Years 9,806,878.11 17,736,758.772 - 3 Years 15,963,675.85 6,334,816.213 - 4 Years 1,419,892.56 2,428,920.904 - 5 Years 0.00 0.005 Years and Over 0.00 0.00Totals $32,104,345.25 $30,002,766.12Percentage of Total Portfolio70%60%50%40%30%20%10%0%Portfolio Maturity Distribution¹December 31, 201059.1%September 30, 201049.7%30.5%21.1%10.1% 10.9%8.1%3.7%4.4%1.5% 0.8%0.0%0.0% 0.0% 0.0% 0.0%Overnight Under 6 Months 6 - 12 Months 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years 5 Years and OverNotes:1. Callable securities in portfolio are included in the maturity distribution analysis to their stated maturity date, although they may be called prior to maturity.PFM Asset Management LLC Section C - 3

Tohopekaliga Water Authority Investment Report - Quarter Ended December 31, 2010Operating Portfolio Maturity Distribution versus the Benchmark¹30.0%25.0%20.0%Market Value15.0%10.0%5.0%0.0%Years to MaturityOperating PortfolioMerrill Lynch 1-3 Year U.S. Treasury Note IndexNotes:1. Due to the nature of the security, Mortgage-Backed Securities are represented based on their average life maturity rather than their final maturity.PFM Asset Management LLC Section C - 4

Tohopekaliga Water Authority Asset Allocation as of December 31, 2010*Security Type 1 December 31, 2010 Notes Permitted by PolicyFlorida SBA 0.00% 100%Asset Allocationas of December 31, 2010United States Treasury Securities 29.31% 100%United States Government Agency Securities 0.00% 100%Federal Instrumentalities 36.50% 100%Certificates of Deposit 0.00% 100%Repurchase Agreements 0.00% 100%Commercial Paper 3.25% 100%Corporate Notes - FDIC Insured 5.01% 100%Mortgage-Backed Securities 2.47% 100%Bankers' Acceptances 0.00% 0%State and/or Local Government Debt 0.00% 100%Money Market Mutual Funds 23.46% 100%United StatesTreasury Securities29.31%FederalInstrumentalities36.50%Money MarketMutual Funds23.46%Commercial Paper3.25%Corporate Notes -FDIC Insured5.01%Mortgage-BackedSecurities2.47%Intergovernmental Investment Pool 0.00% 0%Individual Issuer Breakdown December 31, 2010 Notes Permitted by Policy Individual Issuer Breakdown December 31, 2010 Notes Permitted by PolicyGovernment National Mortgage g Association (GNMA) 0.00% 100% CD - Bank A 0.00% 100%US Export-Import Bank (Ex-Im) 0.00% 100% CD - Bank B 0.00% 100%Farmers Home Administration (FMHA) 0.00% 100% Fully collateralized Repo - A 0.00% 100%Federal Financing Bank 0.00% 100% Fully collateralized Repo - B 0.00% 100%Federal Housing Administration (FHA) 0.00% 100% Credit Agricole CP 3.25% 100%General Services Administration 0.00% 100% General Electric Corporate Notes - FDIC insured 1.57% 100%New Communities Act Debentures 0.00% 100% Citigroup Corporate Notes - FDIC insured 1.68% 100%US Public Housing Notes & Bonds 0.00% 100% Bank of America Corporate Notes - FDIC insured 1.76% 100%US Dept. of Housing and Urban Development 0.00% 100% Corporate Notes - FDIC insured D 0.00% 100%Federal Farm Credit Bank (FFCB) 4.38% 100% Corporate Notes - FDIC insured E 0.00% 100%Federal Home Loan Bank (FHLB) 5.05% 100% BA Bank A 0.00% 100%Federal National Mortgage Association (FNMA) 18.25% 100% Municipal Notes/Bonds 0.00% 100%Federal Home Loan Mortgage Corporation (FHLMC) 11.29% 100% Money Market Fund - PFM Funds 23.46% 100%Student Loan Marketing Association (SLMA) 0.00% 100%Notes:1. End of month trade-date amortized cost of portfolio holdings, including accrued interest.PFM Asset Management LLC Section D - 1

CATEGORY: Staff ReportsREPORT ON REFINANCING OF THE SERIES 2007 BONDS THROUGH THE SALE OF THESERIES 2011A BONDSExplanation: On March 2, 2011, First Southwest was able to successfully complete the sale ofthe Series 2011A Bonds to transition from the Series 2007 Variable Rate Bonds to fixed ratefinancing. The same day, about an hour after completing the sale of the bonds, the fixed payerSWAP was terminated. A summary of the transaction with a comparison to finance numberprovided at the February 23 rd Board Meeting is provided below. The bond sale wasaccomplished in an extremely favorable environment as there was little financing being doneon March 2 nd , there was substantial demand for tax exempt financing, and the Authority’soffering had the best credit rating of those being offered. As a result, the Series 2011 bondoffering was oversubscribed by 500% within less than two hours. The oversubscriptionprovided the underwriter the ability to leverage the prospective buyers to offer lower rates forvarious bond maturities. The net result as shown below was to get the total debt servicenumber to $198,405,560 which is closer to the debt number that had been projected in earlyNovember of last year, right before the market became unsettled and prevented therefinancing then. For once, all of the market factors appeared to work in the Authority’s favor.The Authority’s finance team of First Southwest, Mike Garner (SWAP Advisor) and particularly,Toby Wagner, the Authority’s financial advisor, should be commended for their patience andcommitment to achieving the Authority’s finance goals.Toho Water Authority Utility System Revenue Refunding Bonds, Series 2011AFull Refunding March 2, 2011Date of Scenario 2/17/2011 3/2/2011Series 2011A 1,2Par Amount $95,410,000 $93,495,000Additional Contribution $0 $0Total Debt Service (2011A) $209,688,863 $198,405,560Aggregate Debt ServiceAvg. Annual Debt Service2012 - 2013 $15,496,541 $15,498,3912014 - 2029 $15,596,982 $15,597,8552030 - 2036 $14,449,491 $12,847,8871 Series 2011A uninsured rates as of date of scenario2 Swap termination amount provided by Echo Financial Products as of date of scenario 11A